Delhi District Court
Shree Baba Somnath Logistics vs Roots Cooling Systems Pvt Ltd on 23 November, 2024
IN THE COURT OF Ms. NIRJA BHATIA
DISTRICT JUDGE (COMM-07), DIGITAL
SOUTH-EAST DISTRICT, SAKET COURT, NEW DELHI
CS(COMM) 385/2022 & CS(COMM) 1180/2022
M/s Shree Baba Somnath Logistics
Through its Attorney Holder, Sh. Purshotam
Having its Office at
743/2A, Near Guga Park, Mundka
New Delhi - 110041
.........Plaintiff.
Versus
M/S Roots Cooling Systems Pvt. Ltd.
Having registered office at:
B-20, 2nd Floor, Kailaash Colony
New Delhi - 110048
And also at:
B-53, Hosiery Complex, Phase-II,
Noida, U.P. - 110020
..... Defendant
Date of Institution: 21.04.2022
Arguments concluded on : 13.11.2024
Date of Judgment: 23.11.2024
And
M/S Roots Cooling Systems Pvt. Ltd.
Through its Authorised Representative
Having registered office at:
B-20, IInd Floor, Kailash Colony
New Delhi - 110048
....Counter- claimant
M/s Shree Baba Somnath Logistics
Having its Office at
Digitally
signed by
NIRJA
NIRJA BHATIA
BHATIA Date:
2024.11.23
Page no. 1/39
15:58:32
+0530
743/21, Near Guga Park, Mundka
New Delhi - 110041.
......Respondent
Date of Institution: 07.12.2022.
Arguments concluded on : 13.11.2024.
Date of Judgment: 23.11.2024.
JUDGMENT
(1) This judgment shall decide the suit filed by Sh. Purshottam, Attorney of M/s Shree Baba Somnath Logistics (a proprietorship firm) having its registered office at 743/2A, Near Guga Park, Mundka, New Delhi - 110041 (hereinafter referred as plaintiff).
(2) The suit is filed against M/s Roots Cooling Systems Pvt. Ltd., a company registered under Companies Act (hereinafter referred as defendant), engaged in the business of rigid media type air washers and natural ventilation systems. (3) The plaint enumerate the following:-
(i) That plaintiff is engaged in the business of transport and is providing the facility under the Trade name as "Shree Baba Somnath Logistics".
(ii) That, defendant through its Director namely Sh. Anoop Saxena and Sh. Rajeev Saxena (defendant no. 2 and 3) approached the plaintiff in the year 2017 for engaging the transport on hire charge basis. Plaintiff states that orders were placed and all goods were duly transported at the commanded location via office of defendant no. 1 at Noida.
(iii) The invoices were issued and were duly acknowledged by the defendant as expression of liability by putting a receipt along NIRJA BHATIA with stamp.Digitally signed by NIRJA BHATIA Page no. 2/39 Date: 2024.11.23 15:58:40 +0530
(iv) Plaintiff claims that defendants were irregular in making payments since inception, and committed defaults. At the closure of the accounts, plaintiff observed that against invoices issued for sum of Rs. 77,22,370/-, defendant only paid Rs. 41,01,289/-, leaving an outstanding of Rs. 36,21,081/-.
(v) Plaintiff alleges that the goods transported by the defendants were typical in nature and unless the goods were packed and ready for dispatch. Vehicle in which they could be transported could not be decided. This on many occasions led the vehicles to be replaced after the packaging of the goods were done, which raised the costing.
(vi) Plaintiff claims that unit-wise invoices were prepared and raised on defendant's instructions as defendants prepared unit wise invoices and claimed freight charges against them.
(vii) Plaintiff alleges that the defendants are denying to pay the outstanding of Rs. 36,21,081/-, upon which interest @ 21% per month is payable. It is stated that defendant is refusing to accept the liability despite receipt and acknowledgment of invoices. The invoices are accounted in the ledger maintained and the defendant has perused and confirmed the entries.
(viii) Plaintiff claims that no payment is made by defendant after 12.07.2019. Since the amounts are unpaid, cause of action is continuing in plaintiff's facour.
(ix) Plaintiff made efforts for pre-litigation mediation. However, since defendant did not appear, non-starter report was returned. The suit, hence, is filed.
Written Statement of Defendant no. 1 Digitally signed by NIRJA NIRJA BHATIA BHATIA Date:
2024.11.23 15:58:47 +0530 Page no. 3/39 (4) Defendant no. 1 (Company), filed its separate Written Statement from Defendants (no. 2 and 3, Directors of defendant no. 1). Below submissions are made:
(i) Defendant claimed that the suit is nothing but a malafide attempt made by plaintiff and is based on misconceived and mischievous pleas with the intention to abuse the process.
(ii) That plaintiff has approached the court suppressing the material facts with unclean hands and the suit suffers from inherent abnormalities, unexplained averments and missing facts.
It is alleged that plaint is premised on forged, manipulated and fabricated documents.
Replying on merits
(iii) Defendant admitted that plaintiff is a transport carrier and a proprietorship. It has been transporting goods of defendant since 2017.
(iv) Defendant submitted that the business with plaintiff was being managed by Sh. Ramjivan Choudhary and Sh. Sushil Kumar, GM Finance and former accountant of defendant no. 1, who in collusion with plaintiff cleared all the bills. Defendant trusted the above officials since they were directors. However, it transpired that since inception of the transactions between the parties, the plaintiff engaged in overpricing .
(v) Plaintiff was made aware that the charges quoted were not as per market rate and plaintiff was giving arbitrary and overpriced quotes for its services. The plaintiff then assured the defendant that invoices shall be raised as per market standards. However, entries in invoices were observed as incorrect and against market standard rates. Some of the invoices were forged NIRJA and fabricated.
BHATIA Digitally signed by NIRJA BHATIA Page no. 4/39 Date: 2024.11.23 15:58:54 +0530
(vi) Defendant asserts that it learnt of the fraud played upon it by the plaintiff in conjuncture and connivance of former GM and accountant namely Ram Jeewan Choudhary and Sushil Kumar who forged various documents. An FIR was lodged against Ms. Pooja Sharma, Proprietor of plaintiff and the power of attorney, Purshottam Sharma under several sections of Indian Penal Code at Gautam Buddha Nagar. As a recourse they applied for the anticipatory bail. It is claimed that plaintiff has filed the present suit as a counter-blast.
(vii) Defendant denied any outstanding or dues against invoices and claimed to have made complete payment timely. It is alleged that Sh. Ram Jeewan Choudhary and Sh. Susheel Kumar handed over blank cheques to plaintiff after they were signed by directors of defendant under trust in guise of maintaining regular business transaction fraudulently. The cheques are claimed to carry no liability.
(viii) Defendant reiterates its allegations that the invoices are forged and hence do not tally with the statement of account. It is claimed that plaintiff has raised bills for journeys which were not undertaken for defendant's projects. Defendant also filed a counter-claim for recovery, premised on above allegations.
(ix) Defendant denied that it deliberately avoided the participation in pre-litigation mediation, due to which reason the suit is filed.
Written Statement of Defendant no. 2 and 3. (5) Defendant no. 2 and 3 filed combined Written Statement and pleaded no cause of action against them. It was asserted that NIRJA being Directors of Defendant no. 1. They have been incorrectly BHATIA Page no. 5/39 Digitally signed by NIRJA BHATIA Date: 2024.11.23 15:59:00 +0530 arrayed in present case and ought to have been deleted U/O 1 Rule 10 (2) CPC, as they have no personal liability towards the credits of any company. While making submissions on merits the pleas raised under the plaint were denied and it was reasserted that plaintiff has raised mischievous pleas of liability in connivance with the employees of defendant no. 1.
Replication (6) (i) Plaintiff filed the replication to both the Written Statements and reasserted the facts stated in the plaint. It is alleged that the defendant is raising the issue of overpricing for the first time as no such matter was raised despite party's engagement in voluminous transactions of business for about 4 years. It is claimed that the pleas raised are false and malicious with intention to avoid the liability, as had there been an overvaluation or over-pricing, the defendant would not have cleared the payments and must have avoided to hand over the cheques.
(ii) Plaintiff claimed the correctness of entries maintained in its ledger account. It is observed that the liability is admitted by way of acknowledgment put on the invoices through signatures and stamps.
(iii) Plaintiff claimed that the defendant did not place even a single document to substantiate the plea of pricing, which for the first time is raised in the reply.
(iv) Replication to Written Statement of Defendant no. 1 and 2 was separately filed. It is denied that defendant no. 2 and 3 being directors of defendant no. 1 are not liable. Plaintiff claimed that the plea of discharge by defendants No. 1 and 2 should not be NIRJA BHATIA Digitally signed by NIRJA BHATIA Page no. 6/39 Date: 2024.11.23 15:59:08 +0530 entertained as they are operating in capacity of Managing Directors under clause 2 (54) Companies Act 2013 read with Section 2(60) of the Companies Act, and they are officers in default and hence necessary and proper party to the suit. Plaintiff denied that the suit is devoid of any contract of guarantee, privity of contract and without any allegation / assertion against defendant no. 2 and 3. Plaintiff is making them personally liable.
(v) It is claimed that defendants cannot be allowed to engage in 'Forum Shopping' as they themselves got the FIR against the proprietor of plaintiff and power of attorney registered. The statements made in the plaint against Defendant no. 2 and 3 were asserted and it is prayed that suit be decreed.
Facts of the counter-claim The defendant filed a counter-claim and took the pleas below:-
7 (i) That the defendant is in business of providing the services of central air conditioning and refrigeration segment. Defendant is carrying various projects all over the India. It is admitted that the defendant interacted with plaintiff, a transport carrier proprietorship and transported good since 2017.
(ii) That on behalf of defendant the transactions were taken care by Sh. Ram Jeewan Choudhary and Sh. Shushil Kumar. The management of defendant trusted the above named employees, however, defendant colluded with the plaintiff.
(iii) Defendant claims that the plaintiff raised overpriced bills which issues was raised in several meetings. Plaintiff informed that the charges quoted were not as per market rate as pricing was Digitally signed by arbitrary.
NIRJA NIRJA BHATIA BHATIA Date:
2024.11.23 15:59:16 +0530 Page no. 7/39
(iv) That plaintiff assured the defendant that the invoices shall be raised as per market standards and only market rates shall be charged, whereupon, defendant agreed to avail the transport services.
(v) Defendant claims that the payments were made timely, however, it was learnt that several invoices were not correct as they were not based on the marked standards. Plaintiff manufactured and forged various invoices and falsely issued them in the name of defendant.
(vi) That defendant made the payments against the invoices on advice of Ram Jeewan Choudhary and Shushil Kumar as they were solely responsible to deal with the plaintiff, however, their collusion and fraud in connivance with the plaintiff could not be detected till it was revealed to defendant that the above named employees have fabricated books of accounts issues four cheques and have duped the defendant by over-charging the invoices.
(vii) Defendant claims that an FIR is lodged against the proprietor of plaintiff and her husband Sh. Purshottam Sharma u/s 420, 467, 468, 120B r/w Section 506 and 408 of IPC at Gautam Buddha Nagar where the Smt. Purshottam Sharma and Sh. Pooja Sharma applied for anticipatory bail which is rejected.
(viii) It is claimed that the defendant paid the amounts of Rs.
41,01,289/- where as the dues was only Rs. 36,48,210/-. As an excess payment of Rs. 6,41,189/- is paid, same is recoverable for which the present counter-claim is filed.
Reply filed by plaintiff.
(8) (I) Plaintiff filed the Written Statement and raised the issue of Digitally signed by maintainaibility. It raised preliminary objection alleging the NIRJA NIRJA BHATIA BHATIA Date:
2024.11.23 15:59:22 +0530 Page no. 8/39 counter-claim to be counter-blast and malacious attempt to avoid the payment. It is stated that counter claim is premature and no cause of action has arisen in favor of defendant.
(ii) It is claimed that the defendant acknowledged their liability against the invoices raised by putting signatures and stamps. Plaintiff claims that a total business of about Rs.
77,22,370/- is transacted between the parties and as per its books of amount of Rs. 36,21,081/- is recoverable as due as the last payment was received on 12.07.2019. Plaintiff claims that the defendant transported the goods unit wise which led to raising of unit wise invoice and there were multiple goods transported in the vehicle.
(iii) The statements of the counter-claimants is denied. Plaintiff re-asserted its claim of recovery and denied any collusion or connivance. It is denied that the bills are forged or fabricated. It is denied that as per books of accounts, the counter-claimant is entitled to recover an amount of Rs. 6,41,189/-. The factum of registration of FIR No. 0054 of 2021 is admitted, however, the contents of the FIR are denied. It is claimed by the respondent that a petition for quashment of FIR is moved before the Hon'ble High Court. Plaintiff asserted that as per mutual running and current account, an outstanding of Rs. 36,21,081/- is shown due on 07.03.2022 for which the recovery is prayed. Replication (9) Replication is filed wherein the contents of the Written Statement are disputed and denied and the counter-claimant reasserted the pleas. It is challenged that the Written Statement is not properly filed since it does not have the verification U/O 6 Rule 15 A which shall have been appended with the proceedings Digitally signed by NIRJA NIRJA BHATIA BHATIA Date:
2024.11.23 Page no. 9/39 15:59:31 +0530 under Commercial Courts Act. It is stated that in view of the above the Written Statement, filed is not to be read. The statements made in the plaint are expanded and reiterated as above.
Before adverting further note of the proceedings is observed:
(10) Present suit being filed on 21.04.2022, processes were directed on 21.05.2022. On 01.08.2022, defendants caused appearance on being served on 03.06.2022 and moved an application U/O 8 Rule 1 CPC seeking condonation of delay along with Written Statement and Vakalatnama. (11) Matter was listed on 03.09.2022 on which date an application U/O 1 Rule 10 (2) CPC r/w Section 151 CPC was filed by defendant no. 2 and 3. My Ld. Predecessor on the same date was pleased to decide application U/O 8 Rule 1 CPC and allowed the filing of written statement, subject to cost. Upon application U/O 1 Rule 10 (2), defendant No. 2 and 3 (being directors) are deleted vide order of 16.11.2022. (12) Issues are framed on 05.12.2022. Parties lead their respective evidence. However, in the meanwhile, defendant filed the counter-claim which is registered as CS(COMM) 1180/2022.
It is directed that proceedings in CS(COMM) 385/2022 and CS(COMM) 1180/2022 be clubbed. The matter filed as CS(COMM) 385/2022 is directed as a lead case. (13) Ld. Predecessor on 19.05.2023 directed the plaintiff (a proprietorship firm) to amend the plaint to show the proprietor as plaintiff. Necessary amendments in memo of parties was directed.
NIRJA BHATIA Digitally signed by NIRJA BHATIA Date: 2024.11.23 15:59:37 +0530 Page no. 10/39 (14) The combined issues arising out of the proceedings after filing of the counter-claim are framed on 19.05.2023. Both parties led their respective evidence. (15) On closure of defendant's evidence, matter got listed for final arguments on 30.09.2024. Parties made final arguments and filed Written Submissions. I have heard oral arguments and perused the written submissions along with record. (16) As noted above, combined issues arising out of CS(COMM) 385/2022 and CS(COMM) 1180/22 were framed as below:-
Issues (I) Whether plaintiff is entitled to pendente lite and future interest?
(ii) Whether plaintiff in CS(COMM) 385/22 is entitled for pendente lite and future interest? If yes, on what amount and at what rate? OPP
(iii) Whether the plaintiff in CS(COMM) 385/22 is entitled to the cost of the suit? If yest, the quantum? OPP
(iv) Whether the counter defendant over charged the counter plaintiff in CS(COMM) 1180/22 and whether the counter plaintiff is entitled to recover the sum of Rs. 6,41,189/- from the counter defendant as claimed? OP Counter plaintiff
(v) Whether the counter plaintiff in CS(COMM) 1180/22 is entitled for pendente lite and future interest? If yest, on what amount and at what rate? OP Counter Plaintiff.
(vi) Whether the counter-plaintiff in CS(COMM) 1180/22 is entitled to the cost of the suit? If yest, the quantum? OP Counter plaintiff.
NIRJA BHATIA (vii) Relief.
Digitally signed by NIRJA BHATIA Date: 2024.11.23 Page no. 11/39 15:59:43 +0530(17) Before adverting to the reasoning of brief note on the evidence received on record is taken.
Plaintiff's Evidence (18) Sh. Purshottam PW-1 as power of attorney of plaintiff has tendered his affidavit as Ex.PW1/1. Besides this he also tendered the documents as below:-
1. Original Non Starter Report Ex.PW1/A.
2. Original Power of Attorney Ex.PW1/B.
3. Copy of MCA Data alongwith the Certificate under Section 65-B of Indian Evidence Act Ex.PW1/C.
4. Original Invoices Ex.PW1/D (colly).
5. Copy of Ledger Account Ex.PW1/E (Colly).
Cross-examination of PW-1 (19)(a) During cross-examination, PW-1 admitted that Smt. Pooja is the proprietor of plaintiff firm. That he only looks after the business and in no form appointed by plaintiff. That Smt. Pooja is medically fit and is not a pardanashin lady.
(b) He admitted that defendant got FIR No. 54/21 lodged against him and Smt. Pooja alleging cheating, forgery etc, in which case chargesheet is filed.
(c) He claimed that the defendant placed telephonic orders. He admitted that Ex. PW-1/B is not an invoice but a covering letter to that he admitted that document Ex.PW1/B does not bear the stamp of defendant company, at which stage he volunteered that NIRJA it bears the signatures of the female receptionist of defendant. BHATIA Digitally signed by NIRJA BHATIA Page no. 12/39 Date: 2024.11.23 15:59:53 +0530
(d) He admitted that Ex. PW-1/D invoice no. 1397, 1396, 1393, do not carry the stamp and signatures in acknowledgment of the receipt. He claimed that the acknowledgment is on the covering page (Page 26) of the document. He claimed Page no. 34 is the proof of delivery of invoice no. 1397 and stated that he can say the above fact based on the same GR number which is 0480. Deliveries against invoice no. 1396 were claimed through document at Page 36 as both bearing GR no. 0479 was claimed POD of Invoice no. 1393 at page 38 with GR no. 0476. He admitted that there was no acknowledgment on page no. 36 and
38. He claimed that acknowledgment was at page 36 and was which was encircled at point A. Page no. 38 was proof of delivery of bill no. 1393. However, admitted it did not bear the receiving of the defendant.
(e) He claimed that page no. 34 of document Ex.PW1/D, showed delivery to M/S Veeba Food Services and acknowledgment by their receptionist upon the receipt, however, he claimed that acknowledgment was given by M/S Enviro Roots Devices (P) Ltd. subsidiary of defendant company.
(f) He admitted that invoice no. 1372, 1365, 1363, 1351, 1334, 1309 and 1319, carried no acknowledgment, however claimed that the receiving was on covering letter at page no. 27.
(g) He admitted that there is no receiving of defendant at page no. 40 ( POD for 1372), page no. 58 ( POD of 1351), Page 62 ( POD of 1334) and claimed acknowledgment on Page no. 42, 44 ,82, 94 against invoice no. 1365, 1363, 1319 and 1309. He claimed that the receiving of Larsen & Toubro with gate entry Digitally signed by NIRJA stamp of Hindustan Zinc, Page 44 bears the receiving of NMDC. NIRJA BHATIA BHATIA Date:
2024.11.23 15:59:59 +0530 Page no. 13/39 Page 82 bears receiving of Minda Projects and receiving on Page 82 was given by representative of defendant whose mobile number is mentioned. He admitted that Page 94 is a photocopy.
His driver went for delivery to Minda Projects. He claimed page 42, is the acknowledgment of receipt by Hindustan Zinc as M/S L & T was working for Hindustan Zinc Ltd and the POD bears their signatures. He was confronted with Page no. 104 covering letter for 8 invoices no. 1286, 1287, 1288, 1289, 1291, 1292, 1293 and admitted that they were not bearing the stamp of defendant. He volunteered that they were signed by Mr. Ashok, accountant of defendant. He knew Sh. Ashok personally. He admitted that POD at page no. 106 does not bear signatures of defendant but claimed that Page no. 108 bears its receiving at point A by L & T and Gate Entry Stamp of Hindustan Zinc was at point B. Page 110 did not bear signatures. He claimed that the original was handed over to the defendant. He claimed that originals of page no. 112, 110, 114, 116 were submitted to the defendant. He claimed that POD at Page no. 118 and 120 bear the receiving of Devesh Kumar, representative of defendant at Dehradun, where the delivery of goods was made. He admitted that page no. 118 and 120 were photocopies. He claimed that the originals were submitted to the defendant. He admitted that the plaintiff has the carbon copies for documents at page no. 118 and 120 but photocopies are filed. He was shown page no. 121, covering letter for bill submission for invoices 1259, 1262, 1270, 1271. He admitted that defendant did not sign the above document which is signed by Mr. Ashok.
(h) He admitted that invoices mentioned in Q-27 is not signed by the defendant. He was shown the POD for invoice Q-27. He NIRJA BHATIA Digitally signed by NIRJA BHATIA Page no. 14/39 Date: 2024.11.23 16:00:05 +0530 claimed that this POD is received from Maruti Motor Gujarat Pvt. Ltd. where the delivery of material is made. He claimed receiving by UGVN Ltd at page no. 127. He admitted that other pages did not bear any receiving. He claimed that plaintiff did not have the originals as they were submitted to the defendant.
(i) He was recalled on 16.02.2024. He was shown document Ex.PW1/D at page 28 a covering letter for eight invoices nos. 1332, 1333, 1336, 1352, 1353, 1354, 1357. He denied that invoices do not bear the acknowledgment of defendant and claimed that invoices were sent with covering letter / bill submission part of Ex.PW1/D. Upon which he pointed to the acknowledgment and stamp. He admitted though, that some of the goods receipts do not bear the acknowledgment of receiver. He volunteered that most of the goods receipts bear defendant's signature. It is claimed that rest were forwarded along with the bill submission letter. He explained that some of the goods receipts do not show acknowledgment as the original GRs acknowledged by the consignee were handed over to defendant along with the bill. He explained that separate copies could not be kept as they were to be submitted with the bills. He claimed that on few occasions there was no resource available for photocopy. He was shown Page 29 of Ex.PW1/D covering letter for 7 invoices bearing no. 1317, 1322, 13215, 1326 ,1327, 1329, 1356. He admitted that there was no acknowledgment by defendant upon the aforementioned invoices. He was shown invoice Page no. 31 bearing no. 1424 which was exhibited as Ex.PW1/D3. He admitted that no separate bill submission letter is sent in support of above.
NIRJA BHATIA Digitally signed by NIRJA BHATIA Page no. 15/39 Date: 2024.11.23 16:00:12 +0530
(j) He was recalled on 05.04.2024. He admitted that there is no stamp of defendant on Ex.PW1/D3. He could not tell the name of the person who signed Ex.PW1/D3 and volunteered that it is signed by the receptionist of defendant. It is denied that the acknowledgment is not signed by any employee of defendant. He admitted that there is no receiving on GR dated 27.09.2018, issued for invoice Ex.PW1/D3. The GR is exhibited as Ex.PW1/D4. He claimed that original POD was sent along with the invoice. Ex.PW1/D4 is the second copy. It was affirmed that the document is filed by the plaintiff. A signed copy was handed over to plaintiff which was driver's copy.
(k) He was then shown Page no. 95, a covering letter for document Ex.PW1/D (colly). He denied that defendant has not signed the above document and claimed that there is a receiving at point X.
(l) He was shown invoices and GR at page no. 95 of running document Ex.PW1/D (colly). He admitted that none of the invoices mentioned in Page 95 of running documents Ex.PW1/D(colly) is showing the receiving. He volunteered that receiving is collectively given on covering letter, Page 95. He admitted that no GRs at Page 95 i.e. the covering letter is showing the receiving. He denied that the defendant had not signed the document at page 104 and Ex. PW-1/21 of Ex.PW1/D. Though he admitted that the document is not stamped. He was shown Page no. 132, 139, 150, 162, 169 of running documents of Ex.PW1/D (colly), about which his answer was same. He was then shown invoice no. 10, 9, 8, 7, 6 and 5 at pages 480, 482, 484, 486, 488, 490 wherein he admitted that defendant had not signed the above documents and claimed the acknowledgment on Digitally signed by NIRJA NIRJA BHATIA BHATIA Date:
2024.11.23 Page no. 16/39 16:00:19 +0530 the above invoices. He admitted that document is not stamped by the defendant company. At which stage his cross was then deferred.
(m) He was then recalled for 27.04.2024 wherein he affirmed that "to pay" means a person receiving the material has to clear the plaintiff's bill. He volunteered that in some cases if the receiving party did not make the payment against goods received, the defendant had to make the payment. He clarified in some cases only part payment is made by the receiving party in which case remaining is to be paid by the defendant company. He affirmed the remarks "to pay" being written on GR No. 0008 of Ex.PW1/D, invoice no. 00027 and GR No. 0023, part of Ex.PW1/D.
(n) He was enquired about the ledger. Witness claimed that the ledger is maintained in Excel Software. He denied that the outstanding balance mentioned at the end of Ex.PW1/E is incorrect calculation. It is denied that the money has been claimed against duplicate invoices. It is denied that the invoices were forged. After above plaintiff's evidence was closed.
Defendant's evidence (20) DW-1 Sh. Vikram Singh tendered his examination affidavit as Ex.DW1/A and exhibited the following documents:-
(1) Board resolution dated 29.07.2022 filed along with counter claim is Ex.DW1/1.
(2) Board resolution filed along with Written Statement is Ex.DW1/2.
(3) Calculation sheet / Excel sheet detailing forgery / duplication / rate difference of invoice is Ex.DW1/3.
Digitally signed by NIRJA NIRJA BHATIA BHATIA Date:
2024.11.23 16:00:26 Page no. 17/39 +0530 (4) Certificate u/s 65 B of Indian Evidence Act, 1872 is Ex.DW1/4.
(5) Copy of invoices issued by plaintiff / counter defendant is Ex.DW1/5 (colly) (6) FIR bearing no. 0054 of 2021 in P.S. Phase II, Gautam Budh Nagar on 06.02.2021 is Ex.DW1/6.
(7) Rate cards of the other transporters present in the market along with their prevailing rates at the time of services being availed are Ex.DW1/7 (colly).
Gist of cross-examination (21)(a) DW-1 being employee of defendant, was in its employment since 2005. He affirmed the business relations with plaintiff since 2017. He admitted that from 2017, they never objected to the invoices raised by the plaintiff. He was unaware that in the counter-claim defendant has filed any document to reflect upon objections been raised qua the invoices, involved in the present transaction. He was shown his examinaiton affidavit and was asked to clarify the statement to which he replied that he did not remember the invoice numbers qua which the statement in examination affidavit is made. He volunteered that plaintiff made certain cuttings/ corrections in the invoices by hand and and have wrote other figures. He claimed that objection was taken w.r.t. other invoices which are not available on record. He did not know that any such invoice showing cuttings and insertions been made by the plaintiff are filed by defendant. At which stage, he was asked to see the Court record, to which he replied that plaintiff has filed around 400 invoices and he cannot Digitally signed by NIRJA NIRJA BHATIA BHATIA Date:
2024.11.23 16:00:33 Page no. 18/39 +0530 point out from them in short span as it is time consuming to go through each invoice at this stage.
(b) He informed that Sh. Ram Jeewan Choudhary handled defendant's accounts. He was not aware that messages and SMS pertaining to defendant's bank account were received by Ram Jeewan Choudhary. He admitted that cheques are signed by the Directors. He volunteered that due to shortage of funds sometimes Directors issued the blank cheques and which cheques were handed to Sh. Ram Jeewan Choudhary for future utilisation.
At that stage, he was shown Para 13 of his examination affidavit and was asked to clarify upon which he stated that the prices of plaintiff were exorbitant and were on higher side. The defendant learnt the same through price comparison for same distance and period from other transporters. He admitted that no letter or written communication was against Ex.DW1/7 asking for conciliaton of overcharged prices prior to the suit is filed. He volunteered that in the meeting held in 2020, list of comparison and pricing was handed over to plaintiff's representative. There was no written proof on record to show the handing over of documents Ex.PW1/3 to plaintiff's representative in the said meeting. DE was then closed.
The submissions made in the plaint (22) On completion of evidence, Ld. Counsels for parties made their respective submissions. Ld. Counsel for the plaintiff argued that the entire defence put forth by defendant is premised on allegation of manipulation in the invoices raised. It is asserted that defendent never raised this issue at any relevant point of time. This fact is admitted by the AR of the defendant in cross- Digitally signed by NIRJA NIRJA BHATIA BHATIA Date:
2024.11.23 16:00:39 Page no. 19/39 +0530 examination. It is argued that the defendant failed to place a single document on record to substantiate the issue of overpricing and hense has raised a false plea to avoid the liability. It is alleged that the defence taken is sham as the Directors of Defendant could not have issued a cheque without first hand knowledge of the facts involved in the transactions continously for four years. It is averred that the rates relied upon by the defendant to avoid the liability are of the period 2015-18. It is asserted that defendant could not be unaware of the prevailing rates without which he could not have continued the business for span of 4 years. It is argued that defendant's allegations that plaintiff manipulated the invoices and used forged and duplicate invoices is not substantiated, as the defendant's AR despite being asked to show such cuttings and insertions did not even show a single invoice. It is argued that defendant shall burden with the liability and suit be decreed.
Written submissions of defendant (23) Defendant in its written arguments challenged the manner in which the suit is filed. The loans of GPA Sh. Purshottam is doubted. It is argued that a proprietorship concern being not a legal entity cannot initiate a suit in its own name. It is asserted that the suit should have been filed by Ms. Pooja, sole proprietor in her individual name and not under the name of proprietorship firm. It is argued that the suit is not maintainable U/O 30 Rule 10 CPC and is liable to be dismissed. Defendant argued that not even a single document is placed on record to show the identity of the plaintiff. The proprietor is not even examined as a witness.
Digitally signed by NIRJA NIRJA BHATIA BHATIA Date:
2024.11.23 16:00:47 +0530 Page no. 20/39 There is no evidence on record to confirm plaintiff's status as proprietorship firm or to establish the identity of the proprietor. (24) Defendant relied upon order dated 19.05.2023 wherein the defendant was directed to make necessary amendment in plaint and memo of parties to assert that plaintiff did not comply with the directions passed.
(25) Defendant relied upon Svapn Constructions Vs Idpl Employees Cooperative Group housing society, 127(2006)DLT80, to bring home the point that and relied upon the observation that Sole Proprietorship Firm is not a legal entity and argued that a proprietorship cannot sue in its name. (26) Commenting on the evidence, it is asserted that the evidence furnished by the GPA Holder has no legal sanctity. It is argued that GPA did not explain of him having his personal knowledge of the transactions. It is argued that a GPA Holder could prove the contents of the plaint only when he witnessed the transactions and possessed due and explicit knowledge, which must specifically be detailed in the plaint. In the absence of specific assertions regarding the GPA Holders personal knowledge, the evidence is non-admissible. (27) It is argued that the proprietor of company Ms. Pooja Sharma despite being medically fit did not appear in the Court to testify and her failure to do so must leads to an adverse inference, as the omissions undermine the credibility of of the case. It is stated that the GPA does not implead any clause authorising the GPA holder to lead evidence on behalf of plaintiff which under the general principles of law cannot be extended to include leading evidence unless expressly permitted.
Digitally signed by NIRJA NIRJA BHATIA BHATIA Date:
2024.11.23 16:00:55 Page no. 21/39 +0530 (28) Defendant argued upon the inconsistencies in the ledger account Ex.PW1/E and claimed misrepresentation in Section 65 Certificate Ex.PW1/F. It is argued that despite being a computer generated document, no certificate of Section 65 B of Indian Evidence Act is filed and it is only after the objections specifically are raised qua the certificate during examination in chief, the same is filed on 26.10.2023 to fill the lacunaes. (29) It is argued that GPA holder made a false statement in Ex.PW1/F certificate of Section 65 B, that ledger was maintained by plaintiff which is a proprietorship firm, however, the proprietorship firm being not a legal entity cannot independently maintain records which must be prepared and maintained by sole proprietor in present case by Ms. Pooja Sharma or someone explicitly authorized by her. Since neither proprietor nor GPA Holder prepared or maintained the ledger, it raises doubt regarding its authenticity and credibility. It also undermines the reliability of certificate and evidence presented. (30) It is asserted that while the ledger bears the stamp of CA, the certificate of Section 65 B fails to mention the CA name who has not even been examined as a witness to verify the ledger preparation or accuracy. It is argued that the omission above leave the document uncorroborated and fails to meet the requirement u/s 65 B which mandates identifying the person responsible for preparing and maintaining the record. (31) It is asserted that the inconsistencies suggest the invoices section was not audited which further diminishes the credibility of the ledger as the CA stamp appears selectively only on the portions concerning sundry debtor and creditor and not on the NIRJA BHATIA Digitally signed by NIRJA BHATIA Page no. 22/39 Date: 2024.11.23 16:01:02 +0530 section containing invoices allegedly raised against the defendant.
(32) Pointing to the inconsistencies it is argued that the ledger does include an opening balance to establish the financial starting point of the account on a running balance to track cumulative accounts owed or paid.
(33) It is argued that lack of essential details makes it impossible to verify the continuity and accuracy of the ledger.
The entries for invoices allegedly raised against the defendants are claimed fabricated as lack proper description such as details of debit and credit, the nature and purpose of transactions or supporting documentation like purchase orders or receipts. It is stated that simply listing "invoice no.", "date" and "amount" without supporting evidence is inadequate to establish the validity of transactions. It is argued that the presentation of alleged invoices with superficial data and no verifiable supporting documentation gives a strong impression of forgery and fabrication.
(34) Defendant relied on Central Bureau Of Investigation Vs. V.C. Shukla & Ors, 1998 (3) SCC 410 and Chandra Prabhakar Goswami and Ors Vs. Guwahati Bank and Ors, 1967, 1 SCR 898, to claim that the value of ledger account without any proof of business transaction will have not basis. It is argued that merely on the basis of statement of account, liability cannot be saddled on defendant as the bill books are also considered to be self created evidence. It is asserted that keeping in view the foregoing reasons the ledger filed by plaintiff is false and fabricated and hence does not satisfy the requisite of Section 34 of Indian Evidence Act.
Digitally signed by NIRJA NIRJA BHATIA BHATIA Date:
Page no. 23/392024.11.23 16:01:08 +0530 (35) It is argued that plaintiff failed to prove the invoices Ex.PW1/D (colly). It is stated that the invoices and goods receipts filed do not bear any receiving stamp of defendant company indicating lack of proper acknowledgment. It is stated that despite claim, invoices were never handed over to the defendant company and additionally several alleged invoices and goods receipts were photocopies and not original documents qua which the objections were raised during cross-examination. (36) It is claimed that plaintiff in collusion with Ram Jeewan Choudhary and Sushil Kumar manipulated and fabricated the invoices. The above named individuals are alleged responsible for managing the defendant's finance and account. It is alleged that plaintiff deceived the defendant by accepting the payment of fraudulent invoices against which act a combined FIR Ex.DW1/6 is lodged.
(37) Defendant alleged that plaintiff issued duplicate bills and invoices for journeys which were not undertaken. Plaintiff raised third party invoices for journeys, which were overpriced.
Arbitrary invoicing, re-issuance of paid invoices at plaintiff's instances is alleged. Defendant relied on Harish Mansukhani Vs. Ashok Jain, 2009 (109) DRJ 126, to claim that the plaintiff has to prove his case and in a suit for recovery of money in respect of goods supplied, plaintiff is required to establish by way of positive evidence that goods against invoices were delivered to the defendant whereafter he shall bring corroborative evidence in the form of statement of account. It is argued that there is no unequivocal document which shows that what amount has been received by the plaintiff and what is remaining to be paid. It is claimed that plaintiff is unable to show that how he is entitled to Digitally signed by NIRJA NIRJA BHATIA BHATIA Date:
2024.11.23 16:01:15 Page no. 24/39 +0530 claim of Rs. 36,21,081/- as the invoices have not been received by the defendant. It is argued that even plaintiff was unable to show the manner in which defendant was made to receive the invoices. It is argued that since the burden was on the plaintiff to prove his case and as plaintiff has not been able to prove or substantiate the genuineness of the invoices, plaintiff has miserably failed to pass the test of preponderance of possibilities in the Civil Case. Reliance is then placed on Anant Swaroop Data Vs. PNB, 1996 SCC Online P&H 655. Reliance is then placed on Section 101 and law laid in P.D. Verma and Co Vs. Laxmi Builders 2014 SCC Online Del 2160. (38) Defendant asserted that present case presents sufficient grounds for the application of Section of 106 and 114 G of Indian Evidence Act. It is asked that adverse inference be raised as plaintiff withheld crucial evidence by not examining the proprietor Ms. Pooja Sharma, the CA, Drivers or the receptionist. (39) It is stated that plaintiff must upon its own strength to prove its case which law is stated M/S Gauhati Roller Flour Mills Vs. Smti Premoda Medhi and others, RSA 35/2012, DOD 15.02.2022, Hon'ble the Gauhati High Court. On the above arguments, dismissal of the suit is prayed.
Reasons for decisions.
I propose to discuss my findings upon the issues in the manner below:-
Issue no. 1, 2 and 3 (40) At the outset it be observed that the plaintiff is impleaded as a proprietorship concern. Vide order dated 19.05.2023, my Ld. Predecessor observed that proprietorship concern is not a legal Digitally signed by NIRJA NIRJA BHATIA BHATIA Date:2024.11.23 Page no. 25/39
16:01:22 +0530 person / entity. A direction hence was issued to plaintiff to amend the plaint and memo of parties to show the proprietor as plaintiff. However, plaintiff did not comply with the order. The proceedings are continued in the name of the firm. In Miraj Marketing Corporation Vs. Vishakha Engineering and Ors, 115 (2004) DLT 471, observations as below is made:
"As there was no statement as to who was the proprietor of the firm in the plaint nor it was mentioned as to who had signed the plaint which was held by the trial court. Let a proprietor ship firm is not a legal entity and therefore the suit could not be brought in the firms name. The suit was accordingly dismissed."
(41) The Hon'ble High Court in Svapn Constructions Vs Idpl Employees Cooperative Group housing society, 127 (2006) DLT 80 observed that the sole proprietorship firm is not a legal entity, the petition should have been filed by the sole proprietor in his name, on behalf of his sole proprietorship firm, and not in the name of sole proprietorship firm.
(42) It is observed considering it from any point the inevitable inference is that petition in the name of sole proprietorship firm name which is not a legal entity is not maintainable." (43) In view of above, despite directions to amend the status as the plaintiff failed to take remedial steps on which ground itself the suit having not been filed by legal entity is not maintainable. (44) Additionally, the suit is instituted under the signatures of GPA Sh. Purshottam. Sh. Purshottam is husband of Smt. Pooja Sharma, Sole proprietor. Plaintiff exhibited his General Power of Attorney as Ex.PW1/B. The perusal of general Power of Attorney shows Ms. Pooja Sharma as the executant and Sh. Purshottam Sharma, being recipient of attorney to do the acts Digitally signed by NIRJA NIRJA BHATIA BHATIA Date:
2024.11.23 Page no. 26/3916:01:29 +0530 specified therein, which are to represent her before any court law, to appoint any solicitor, to prosecute the case and proceedings by filing, signing and verifying plaints, pleadings etc, applied for inspection, compromise the case and to do generally all other acts and things for the conduct of the case as she could have done it, if she was personally present . While executing the attorney, Smt. Pooja Sharma, proprietor, did not extend any specific authority in favour of Sh. Purshottam to make a statement as witness during the course of any trial. The act of Sh. Purshottam Sharma in making statement thus suffers from infirmity.
(45) Sh. Purshottam Sharma, either in his evidence or through the contents of Ex.PW1/B did not explain his connection with the proprietorship, except showing he is husband of proprietor Pooja Sharma. He in his cross-examination admitted that "I do not have any appointment letter / identity card issued by the plaintiff firm". The above specified that he is neither employee in the plaintiff firm nor has any concern with the day to day activities of the plaintiff firm in any capacity accept that of being husband of the proprietor. He did not state how in his capacity of proprietor's husband, he came across the functioning of business.
His role in the realm of disputed transactions is unexplained. In which background, his capacity to depose on behalf of proprietor qua the facts which only a proprietor would have known through the course of business and thus would have gained the personal knowledge of those facts related to the transactions are not shown to have been gained by the attorney holder. The Hon'ble Supreme Court in Janki Vashdeo Bhojwani and Anr. Vs. Digitally signed by NIRJA NIRJA BHATIA Date:
BHATIA 2024.11.23 Page no. 27/39 16:01:38 +0530 Indusind Bank Ltd. and ors., AIR 2005 SC 439, discuss this issue in detail and observed as below:-
"The second fallacy of the order of Tribunal was allowing Mr.V.R.Bhojwani (power of attorney holder), husband of appellant no.2 Ms.Mohini Laxmikant Bhojwani, to appear in the witness box on behalf of the appellants. It may be noted that that the appellants were shy away from gracing the box. The respondent-bank vehemently objected to allowing the holder of power of attorney of the appellants to appear in the witness box on behalf of the appellants. This Court clarified that the burden of proving that the appellants have a share in the property will be on the appellants and it was incumbent on the appellants to have graced the box and discharged the burden that they have a share in the property, the extent of share, the independent source of income from which they have contributed towards the purchase of the property.
.............................................................. ..............................................................
............................................................ ............................................................. The question whether the appellants have any independent source of income and have contributed towards the purchase of the property from their own independent income can be only answered by the appellants themselves and not by a mere holder of power of attorney from them. The power of attorney holder does not have the personal knowledge of the matter of the appellants and therefore he can neither depose on his personal knowledge nor can he be cross-examined on those facts which are to the personal knowledge of the principal. Order III, Rules 1 and 2 CPC, empowers the holder of power of attorney to "act" on behalf of the principal. In our view the word "acts"
employed in Order III, Rules 1 and 2 CPC, confines only in respect of "acts" done by the power of attorney holder in exercise of power Digitally signed by NIRJA NIRJA BHATIA BHATIA Date:
2024.11.23 16:01:45 Page no. 28/39 +0530 granted by the instrument. The term "acts" would not include deposing in place and instead of the principal. In other words, if the power of attorney holder has rendered some "acts" in pursuance to power of attorney, he may depose for the principal in respect of such acts, but he cannot depose for the principal for the acts done by the principal and not by him. Similarly, he cannot depose for the principal in respect of the matter which only the principal can have a personal knowledge and in respect of which the principal is entitled to be cross-examined.
Having regard to the directions in the order of remand by which this Court placed the burden of proving on the appellants that they have a share in the property, it was obligatory on the part of the appellants to have entered the box and discharged the burden. Instead, they allowed Mr. Bhojwani to represent them and the Tribunal erred in allowing the power of attorney holder to enter the box and depose instead of the appellants. Thus, the appellants have failed to establish that they have any independent source of income and they had contributed for the purchase of the property from their own independent income. We accordingly hold that the Tribunal has erred in holding that they have a share and are co-owners of the property in question. The finding recorded by the Tribunal in this respect is set aside.
(46) In above background, it is noted that, admittedly Smt. Pooja Sharma, proprietor is neither unfit to depose nor is a pardanashin lady. PW-1 did not explain any reason for her to shy away from appearing as witness to state her own case. In the above judgment of Janki Vashdeo Bhojwani (supra), Hon'ble Supreme Court made observations as below:
"Apart from what has been stated, this Court in the case of Vidhyadhar vs. Manikrao and Another, (1999) 3 SCC 573 observed at page 583 SCC that Digitally signed by NIRJA NIRJA BHATIA BHATIA Date:
2024.11.23 Page no. 29/39 16:01:53 +0530 "where a party to the suit does not appear in the witness-box and states his own case on oath and does not offer himself to be cross-examined by the other side, a presumption would arise that the case set up by him is not correct". In civil dispute the conduct of the parties is material. The appellants have not approached the Court with clean hands. From the of the parties it is apparent that it was a ploy to salvage the property from sale in the execution of Decree. On the question of power of attorney, the High Courts have divergent views. In the case of Shambhu Dutt Shastri Vs. State of Rajasthan, 1986 2WLL 713 it was held that a general power of attorney holder can appear, plead and act on behalf of the party but he cannot become a witness on behalf of the party. He can only appear in his own capacity. No one can delegate the power to appear in witness box on behalf of himself. To appear in a witness box is altogether a different act. A general power of attorney holder cannot witness on behalf of the plaintiff in the capacity of the plaintiff. be allowed to appear as a witness on behalf of the plaintiff in the capacity of the plaintiff.
The aforesaid judgment was quoted with the approval in the case of Ram Prasad Vs. Hari Narain & Ors. AIR 1998 Raj. 185. It was held that the word "acts" used in Rule 2 of Order III of the CPC does not include the act of power of attorney holder to appear as a witness on behalf of a party. Power of attorney holder of a party can appear only as a witness in his personal capacity and whatever knowledge he has about the case he can state on oath but be cannot appear as a witness on behalf of the party in the capacity of that party. If the plaintiff is unable to appear in the court, a commission for recording his evidence may be issued under the relevant provisions of the CPC. ............................................................ ..............................................................
Digitally signed by NIRJA NIRJA BHATIA BHATIA Date:
2024.11.23 16:01:58 +0530 Page no. 30/39 However, in the case of Luis & Anr. Vs. Floriano Armando Luis & Anr. reported in 2002 (2) Bom.C.R.754 on which the reliance has been placed by the Tribunal in the present case, the High Court took a dissenting view and held that the provisions contained in order III Rule 2 of CPC cannot be construed to disentitle the power of attorney holder depose on behalf of his principal.
The High Court further held that the word "act" appearing in order III Rule 2 of CPC takes within its sweep "depose". We are unable to agree with this view taken by the Bombay High Court in Floriano Armando (supra).
We hold that the view taken by the Rajasthan High Court in the case of Shambhu Dutt Shastri followed and reiterated in the case Ram (supra) is the correct view. The view taken in the case of Floriano Armando Luis (supra) cannot be said to have laid down a correct law and is accordingly overruled."
(47) Above background explains that PW-1 cannot be held competent to testify for plaintiff proprietor Smt. Pooja Sharma. His evidence hence is neither capable of being read nor is to be relied upon, which leads to fact that the suit is neither duly filed nor its contents are proved. Further, in recent case titled as Manisha Mahendra Gala and ors. Vs. Shalini Bhagwan Avatramani & Ors., Civil Appl. No. 9642 of 2010, DOD 10.04.2024, the Hon'ble Supreme Court again observed that a general power of attorney holder can give evidence only of such facts of which he has personal knowledge. As the entire plaint as well as the affidavit filed does not support the context from where the PW-1 has gained the knowledge of the facts qua which deposition is made during the course of the trial, The statement is held incapable of reliance.
NIRJA BHATIA Digitally signed by NIRJA BHATIA Page no. 31/39 Date: 2024.11.23 16:02:05 +0530 (48) Though on the score of above observations further discussions are not needed, despite which the discussions from the merits are now taken note of in order to render complete decision.
(49) The plaintiff alongwith the plaint filed all the invoices. He then exhibited them collectively as Ex. PW-1/D. The perusal of which exhibit (Ex.PW1/D collectively) reflects that approximately 400 invoices together have been filed by the plaintiff on record. During arguments, Ld. Counsel for plaintiff admitted that the invoices submitted on record are pertaining to all the transactions from 2017 till the date of filing of the suit and includes those invoices as well which are paid. (50) The plaintiff has filed the suit claiming the inception of transactions upon negotiation held in the year 2017 for which it was claimed that the payments were realised till 12.07.2019. (51) Ld. Counsel admitted that plaintiff has filed even those invoices against which payments have been realised and received. Those invoices against which payment were already received were not shown to carry a cause of action admittedly. Moreover, as all the invoices were were filed no effort was made to identify those invoices against which the claim is being raised. (52) The pleading is silent about the due invoices for absence of any plea of specific nature, it is almost impossible to identify the debt qua which the recovery is prayed. Besides the process of exhibiting all the invoices is defective and fails to prove the documents specifically against which the liability is claimed. The plaintiff has almost dumped the entire record from his office and explicitly has burdened the court with no effort to separate each invoice making it difficult in order to record finding about the Digitally signed by NIRJA NIRJA BHATIA BHATIA Date:
2024.11.23 Page no. 32/39 16:02:14 +0530 veracity, authenticity and capability of the document as proof. Plaintiff has not cared even to file the list of documents showing the number of invoices, the amounts stated in the said invoices and the mode through which the invoices are sought to be proved. By merely exhibiting the documents, it shall not be deemed proved as is held in law laid in R.V.E. Venkatachala Gounder Vs. Arulmigu Viswesaraswami & V.P.Temple, (2003) 8 SCC 752.
(53) The plaintiff intended to corroborate the invoices with ledger which he exhibited as Ex.PW1/E. An objection to mode of proof is raised at the stage when the document was exhibited, which objection was kept open for decision at the stage of arguments. The objection is not met as no care to address the above is made by plaintiff.
(54) Defendant specifically alleged the document Ex.PW1/E (Colly) ( ledger ) as a poorly maintained document to prove the contents. Defendant stated that ledger is unstamped. The document should not have been brought in evidence and must have been proved by the person preparing / authorizing it. It is observed that plaintiff did not bring his CA as witness who could have stated the reasons for ommission if he would have appeared.
However, he was not called to depose to support the document. As the document is unauthenticated and nor verified, its contents cannot be treated proved. The ledger hence neither proved nor corroborated the invoices Ex.PW1/D (colly) as stated by plaintiff.
(55) Additionally though plaintiff relied upon Ex.PW1/E, it is shown to be photocopy of ledger. The manner in which ledger is NIRJA kept does not inspire the confidence of the ledger being BHATIA Digitally signed by NIRJA BHATIA Page no. 33/39 Date: 2024.11.23 16:02:20 +0530 maintained in normal course of business. It appears that plaintiff has submitted an extract of ledger after having collected the entries in excel sheet in Annexure A and B which do not authenticate the transactions or corroborate dues. (56) Plaintiff has annexed one Annexure C with the list of Sundry Creditors as on 31.03.2021 wherein the names of several parties and amounts are columned. Next to the said Annexure is a Excel Format showing the entry of the name of defendant with Serial No., Bill No., Bill Date, Amount and place of dispatch. However, the document carry no description. It is difficult to presume this excel sheet is a printout of ledger as the format in which the entries are kept is not segregated by financial year. There is no opening or closing balance at the beginning or end. No record of entries having been carried forward is detailed. It is reflecting certain payments by way of NEFT without detailing the accounts or mentioning the details of bank. The entries appear to have been copied in an excel format from an undetailed source. The document is neither verified by the proprietor nor by the accountant or CA. The unverified data is not competent to give any credence to the invoices Ex.PW1/D qua which also the objection has been raised by Ld. Counsel at the stage of exhibition which has been kept open for discussion. In view of above, the document Ex.PW1/F which is prepared much later to the date of filing of the suit and is filed on 21.10.2023 without forwarding the requisites of the provisions of Section 65 B which are mandated under the law laid down in Arjun Pandit Rao Khotkar Vs. Kushanrao Goranyal & Ors, AIR 2020 SC 641, the substance of which does not confirm to the provision is to be discarded. In which background the entries NIRJA BHATIA Digitally signed by NIRJA BHATIA Page no. 34/39 Date: 2024.11.23 16:02:28 +0530 kept in document Ex.PW1/E do not confirm the requisites of Section 34 of Indian Evidence Act which is excerpted below:-
"34. Entries in books of account when relevant.-- 1[Entries in the books of account, including those maintained in an electronic form], regularly kept in the course of business, are relevant whenever they refer to a matter into which the Court has to inquire, but such statements shall not alone be sufficient evidence to charge any person with liability."
(57) As the plaintiff was under burden to prove its case for which reliance is made on invoices Ex. PW-1/D, the plaintiff must have, as per Sections 101 and 102 of Indian Evidence Act, which are excerpted below for reference, the burden is on plaintiff to prove its entitlement against invoices Ex. PW-1/D. The Law is detailed in Harish Mansukhani Vs. Ashok Jain (supra) also.
"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.
Section 102.-- On whom burden of proof lies. The burden of proof in a suit or proceeding lies on that person who would fail if no evidence at all were given on either side."
(58) However, as is observed in previous paras, the plaintiff did not make due and diligent attempt to discharge his burden. As the invoices were not proved, the cause of action to claim recovery qua them is non-substantiated.
NIRJA BHATIA Digitally signed by NIRJA BHATIA Date: 2024.11.23 16:02:43 +0530 Page no. 35/39 (59) In circumstances above, in preponderance the plaintiff has failed to discharge the onus and the issues no. 1, 2 and 3 are decided against the plaintiff.
Issue no. 3 to 7.
(60) The defendant / counter-claimant had filed its own claim praying for recovery of Rs. 6,41,189/-. In crux the claim raised is premised on the allegation that the plaintiff in collusion and connivance with two of its employees namely Sh. Ram Jeewan and Sh. Susheel Kumar, GM Finance, Accountant respectively, forged, fabricated and raised duplicate bills to inflate its liability. It is claimed that the defendant observed that number of bills were already paid despite which they were raised again. It is found that the bills were pertaining to those journeys which were never undertaken and hence without any liability. Moreover, the plaintiff was asked to concile the accounts, however, the plaintiff did not make such effort. In which background, defendant observed its entitlement for amount of Rs. 6,41,189/- for which the counter-claim is filed.
(61) In order to establish its entitlement, the counter-claimant / defendant relied upon the bills raised by the plaintiff collectively as Ex.DW1/5(colly). It also rested upon a calculation / excel sheet allegedly detailing forgery, duplication, rate difference as Ex.DW1/3 and a certificate u/s 65 B to give support which was exhibited as Ex.DW1/4. However, at the cost of repetition as is discussed earlier while dealing with issues 1, 2 & 3, defendant did not make any effort to show against which invoice the payment was already made and which invoices were showing increase in amount or were raised again earlier payment. It was Digitally signed by NIRJA NIRJA BHATIA BHATIA Date: Page no. 36/39 2024.11.23 16:02:49 +0530 not pointed out against which invoice the plaintiff asked for dues without any journey or were devoid of service and hence liability.
(62) The perusal of above document itself shows that defendant did not bring any material from its own side except the copy of the FIR which it lodged and exhibited as Ex.DW1/6. The defendant alleged forgery and overpricing in the invoices on the strength of Ex.DW1/7 which were the rate cards of other transporters present in the market. Defendant claimed their rates prevailing at the time of availing services from plaintiff were lower than what had been claimed by the plaintiff. (63) In view of the observations made by Hon'ble Courts Anil Rishi Vs. Gurbaksh Singh, (2006) 5 SCC 558 , however, the defendant should have relied upon itself to prove its case. It is noted that the alleged overpricing which is raised as a bone of contention in claiming over-valuation, inflation and forgery of bills is based only on Ex.DW1/7. The defendant apparently collected some rate cards from unverified resource. The authenticity and veracity of which is not proved. The documents are not pertaining to the defendant nor the source of the documents have been revealed.
(64) The defendant used a vague term of prevailing market rate without any elaboration and explanation. It is a settled law that fixation of price is a discretion of seller. The defendant has already entered in an agreement upon price through invoice with the plaintiff and rather as per his own admission paid. Consequent to having made the payment and completed the agreement, it does not lie with defendant to dispute the terms of Digitally signed by NIRJA NIRJA BHATIA BHATIA Date:
2024.11.23 16:02:56 Page no. 37/39 +0530 the agreement and or to agitate otherwise as such a right is deemed to have been waived and a practice acquiescenced. (65) While the defendant alleged forgery in bills by insertions and cuttings, no support to above was found as DW-1 in his cross-examination could not identify only such document. He was asked specifically to show the invoices which are allegedly forged from those filed on record to which he replied "I do not remember the invoice number qua which the statement is made".
Though he intended to claim that the cuttings have been made by hand on the invoices and insertion of figures is done by the plaintiff, he could not show even a single invoice whereupon the cuttings are made and insertions are noted. The defendant did not bring even a single invoice specifically to point element of forgery, over-valuation, duplication which is the cause of filing the present counter-claim. The witness after checking approximately 100 bills abandoned the effort and claimed it to be time consuming exercise to go through each invoice. He admitted that the business relations between the parties were existing since 2017. He also admitted that there is no record which suggests that the objection qua the invoices being overvalued or overpriced and or overcharged is ever brought to the knowledge of the plaintiff in writing as is claimed by the witness during the meeting held in the year 2020. Moreover, it is admitted that defendant made payments through the cheques bearing the signatures of Directors of Defendants. The witness could not show that the SMS pertaining to the realization of the transactions through the Bank Account were not received by them and / or were received only by Sh. Ram Jeewan Choudhary. In circumstances above, the claim of over-valuation, over- NIRJA BHATIA Digitally signed Page no. 38/39 by NIRJA BHATIA Date: 2024.11.23 16:03:04 +0530 pricing, forgery inflation against the bills could not be adequately supported or proved. The defendant did not even file its own statement of account to show any dues.
(66) In view of above, no material whatsoever has been brought by the defendant to show any overdue of payment of Rs. 6,41,189/- as is claimed being outstanding. (67) Further, before the filing of the counter-claim the defendant was liable to initiate the proceedings u/s 12A of Commercial Courts Act as is mandated by Hon'ble Delhi High Court in Aditya Birla Fashion and Retail Ltd. Vs. Saroj Tandon, CMM 459/2023 and CM Appeal 13679/2023, defendant has not attempted the same for which reason as well, counter-claim is to be held barred.
(68) From the above discussion, the counter-claimant has not supported issues raised in connection with the counter-claim as the issue no 3 to 7. Since the burden is not discharged, the counter-claim is dismissed.
Findings (69) Suit of the plaintiff for an amount of Rs. 36,21,081/- as well as counter claim of defendant for amount of Rs. 6,41,189/- are dismissed to above discussion with no order to cost. (70) File be consigned to record room after completion of necessary formalities. Digitally signed by NIRJA NIRJA BHATIA BHATIA Date:
2024.11.23 16:03:11 +0530 Announced in open Court (Nirja Bhatia) today on 23rd November, 2024 District Judge (Comm. Court) (Digital-07) South-East, Saket Court, New Delhi Page no. 39/39