Delhi District Court
M/S Kids Collection vs Blue Heaven Garments on 2 April, 2013
IN THE COURT OF SH. REETESH SINGH
ADDITIONAL DISTRICT JUDGE-01 (NORTH-EAST)
KARKARDOOMA COURTS, DELHI
RCA No. 60/2011
Date of Institution of Appeal : 12.01.2011
Date on which Reserved for Judgment : 14.03.2013
Date of Judgment/Order : 02.04.2013
Case I.D. Number : 02402C0010462011
IN THE MATTER OF:-
M/S KIDS COLLECTION
HAVING ITS REGISTERED OFFICE
AT X/373, SECOND FLOOR, LANE NO. 7,
MOHALLA RAM NAGAR, GANDHI NAGAR, DELHI
THROUGH ITS PARTNER
SHRI VENUS KUMAR
.....APPELLANT.
VERSUS
BLUE HEAVEN GARMENTS
THROUGH ITS PROP/PARTNER
SUBHASH CHOWK,
SONEPAT, HARYANA
.......RESPONDENT.
JUDGMENT
1. This appeal has been filed against the impugned order dated 25.11.2010 by which the Learned Trial Court has dismissed the suit of the appellant / plaintiff for recovery of Rs.90,475/-.
2. During the pendency of this appeal the appellant has moved two applications, one under section 151 CPC (filed on 20.9.2011) and another under Order 41 Rule 27 CPC (filed on 1.8.2012), both for permission to lead additional evidence at the stage of appeal. Reply to these applications has been filed by the respondent / defendant. Arguments have been addressed on the applications as RCA No. 60/11 1/11 well as the appeal by the counsel for parties.
3. Brief facts leading to the filing of this appeal are that the plaintiff had filed a suit before the Trial Court averring that it is engaged in the business of garments and that the defendant has been its regular customer. It is averred that the defendant has been purchasing goods from it from time to time making payments in cash from time to time. Plaintiff has averred that it is maintaining a running account with the defendant in respect of the transactions between them.
4. It is averred that the plaintiff has duly met all the orders placed by the defendant. It is averred that as on 07.06.2003, the defendant had made purchases for the value of Rs.58,221/- against payment of Rs.5,000/- was made on 08.03.2005, leaving a balance of Rs.53,221/-.
5. It is averred that the plaintiff approached the defendant several times as well as on 10.12.2005 demanding payment of the balance amount but the defendant refused to pay the same. Plaintiff has claimed that defendant is liable to pay the interest on the outstanding amount of Rs.53,221/- at the rate of 24% per annum w.e.f. 07.06.2003 which amounted to Rs.37,254/- as on 06.05.2006. Plaintiff sent a legal notice dated 15.12.2005 to the defendant calling upon it to pay Rs.78,585/- along with interest at the rate of 24% per annum w.e.f 01.12.2005 but despite service of the notice, the defendant did not make any payment. It is averred that as on date of the suit, the defendant was liable to pay Rs.90,475/- to the plaintiff which included interest on the principal amount of Rs.53,221/- at the rate of 24% per annum. In these circumstances, plaintiff filed a suit praying for decree of recovery of Rs.90,475/- along with interest at the rate of 24% per annum pendentelite.
6. Upon summons being issued the defendant filed its written statement claiming that no amount was payable by it to the plaintiff. It is averred in the preliminary objections that the suit was based on two bills bearing no. 1205 and 1206 which were forged as no goods were ordered to be supplied by the plaintiff against the said invoices. The defendant has also raised a preliminary objection to the effect that the suit of the plaintiff was barred under the provisions of Section 69 (2) of the Partnership Act on the ground that no certificate of registration of the partnership firm of the plaintiff had been filed.
7. Replication to the written statement was filed by the plaintiff in which it RCA No. 60/11 2/11 reiterated its contentions made in the plaint. As regards the objection regarding registration of the plaintiff concern under the Partnership Act and the bar of the suit in view of the provisions under Section 69 (2) of the said Act, the plaintiff merely denied the said contention.
8. On the pleadings of the parties, the Learned Trial Court by order dated 11.10.2007 framed the following issues:-
I. Whether the plaintiff is entitled for decree for recovery of money as prayed for? OPP II. Whether the plaintiff is entitled to any rate of interest and if so, at what rate and for what period? OPP III. Whether the suit of the plaintiff is not maintainable in the eyes of law? OPD IV. Relief
9. In support of its case, the plaintiff examined Sh. Venus Kumar, partner of the plaintiff firm as PW-1. The defendant examined Sh. Pradeep Kumar as DW-1 and Sh. Puran Chand as DW-2 and closed their evidence.
10. After considering the evidence on record, the Learned Trial Court decided issue no. 1 in favour of the plaintiff holding that the plaintiff been able to prove that the defendant had received goods from the plaintiff worth Rs.58,221/- and rejected the defence raised by the defendant that the two bills in question were manipulated.
11. With respect to issue no. 3, the Learned Trial Court held that the plaintiff did not produce its registration certificate in respect of the partnership firm and held the suit to be barred under the provisions of Section 69 (2) of the Partnership Act. In view of the findings on issue no. 3, the Learned Trial Court dismissed the suit of the plaintiff.
12. This appeal was filed by the appellant on 12.01.2011. On 20.09.2011, the appellant moved an application under Section 151 CPC. In para no. 2 of this application the appellant averred as under:-
"2. That the appellant has filed its evidence by way of affidavit, the Partner of the appellant firm namely Shri Venuus Kumar. All the documents filed by the appellant on the court record has been proved RCA No. 60/11 3/11 by plaintiff. The appellant is legally entitled to recover the suit amount the appellant has proved his case. In the evidence the appellant has proved his case that he is entitled for the suit amount.
3. That with regard to the issue no. 3, which was decided in favour of the respondent on the ground that the appellant is a partnership firm and the appellant has not filed any registration certificate of the firm and has failed to prove that it is a registered firm. In this regard it is submitted that the appellant has placed on record all the documents with regard to the firm regarding the partnership and the said partnership firm is registered. At the time of passing the judgment this Hon'ble Court has failed to consider the said fact and as such the issue No. 3 has been decided in favour of the respondent rather the same was to be decided in favour of the appellant in view of the submissions made hereinabove. Furthermore, as the issue No. 1 and 2 has already been decided in favour of the appellant and the said issue No. 3 was also to be decided in favour of the plaintiff, as such the suit of the appellant is liable to be decreed as prayed for in the plaint."
(emphasis supplied)
13. Along with the said application the appellant filed an affidavit titled as "Additional Evidence of PW-1". The basic contention made by the appellant in this application was that it had filed a certified copy of its registration form issued by the Registrar of Firms before the Learned Trial Court which had failed to consider the same. In other words, the appellant contended that it had obtained certified copy of this registration firm and filed the same before the Learned Trial Court which ignored the said document.
14. Reply to this application was filed by the respondent/defendant in which it is averred that appellant has falsely stated that it has placed its certificate of registration before the Learned Trial Court. The respondent averred that the suit of the plaintiff had been dismissed on the sole ground of non-production of its certificate of registration.
RCA No. 60/11 4/1115. The record of the appeal reveals that it was filed on 12.01.2011. Thereafter on 13.01.2011 the appellant has filed, along with list of documents, a photocopy of a letter dated 03.11.2009 written by the plaintiff to Registrar of Firms praying for grant of certified copy of Form A and a certified copy of Form A issued by the Registrar of Firms. As per the same M/s Kids Collection was registered on 02.07.1997 vide no. 1394/97 by the Registrar of Firms having two partners namely Sunder Lal Bhandawat and Venus Kumar Bhagla. The filing index, copy of letter dated 03.11.2009 as well as the certified copy of the Form A bears the stamp of filing of the Court of Additional District Judge-04, Delhi dated 13.01.2011.
16. The Trial Court record does not contain any such document. In other words the certified copy of Form A was not placed on the file of the Trial Court by the plaintiff and this document was filed for the first time on 13.01.2011 in the Court of ADJ-04 (the Court to which this appeal was initially assigned).
17. The application under Section 151 CPC of the appellant was heard by this Court on 30.07.2012. The argument of the parties on this application were recorded by this Court in the order sheet of 30.07.2012 which reads as under:-
"30.07.2012 Present: Sh. Rajender Kumar Sharma, counsel for appellant.
Sh. Sanjay, AR of Appellant.
Sh. Amit Bhatia, counsel for respondent with respondent in person.
Matter is listed for arguments on the application under Order 41 Rule 27 as well on the appeal. By impugned order suit of the plaintiff/appellant for recovery was dismissed by the Ld. Trial Court on the ground that plaintiff was unable to prove that the partnership firm was registered with the Registrar of Firms. Suit was therefore held to be barred under Section 69 (2) of the Indian Partnership Act 1932.
Appeal has been filed on 13.01.2011 and on 20.09.2011 appellant has moved an application under section 151 CPC to lead additional evidence. In para 3 of the application it is averred by the appellant that he had placed the certified copy of Form A issued by Registrar of Firm before the Ld. Trial Court but Trial Court but has failed to consider the same.RCA No. 60/11 5/11
Counsel for respondent/defendant has pointed out that PW1 before the Ld. Trial Court was Sh. Venus Kumar stated to be partner of the partnership firm. In his cross examination Sh Venus Kumar PW1 has categorically stated that it was correct that no certificate of registration of the partnership firm was placed by him on the judicial file.
During the course of arguments of this application counsel for appellant Sh. Rajender Kumar Sharma was repeatedly asked to clarify whether he wished to lead additional evidence at the stage of appeal because a document (certified copy of the registration form of the partnership firm) was not placed before the Ld. Trial Court or whether it was his contention that the said document was placed before the Trial Court but the Trial Court ignored the same. Attention of the counsel was brought to averments made in para 3 of his application for leading additional evidence in which it was averred that the Trial Court did not consider the document although the same was placed on the record of the Trial Court.
Counsel for appellant Sh. Rajender Kumar Sharma has reiterated his contention made in the application that the certified copy of Form A was placed before the Trial Court but the Trial Court has ignored the same.
Order reserved. Put up for orders at 4 PM."
18. It is evident that the counsel for the appellant stuck to his contention that the document certified copy of Form A was filed in the Trial Court which ignored the same even though counsel for respondent pointed out that PW-1 Venus Kumar in his cross examination had admitted that he had not filed the certificate of registration of the partnership firm in the judicial file of the Trial Court. After the orders on the application was reserved and matter was at the stage of pronouncement on orders on the same, the appellant moved another application, this time under Order 41 Rule 27 CPC on 01.08.2012 praying for permission to lead additional evidence. The appellant also moved another application under Section 151 CPC on 09.08.2012 praying for permission to withdraw his earlier application under Section 151 CPC filed on (20.09.2011) in view of the appellant having moved a second application under Order 41 Rule 27 CPC on 01.08.2012.
18. The contention of the second application are that curious para no. 2 and 3 RCA No. 60/11 6/11 of this application read as under:
"2. That this Hon'ble Court has been pleased to ask the appellant about the copy of Registration of Firm. The appellant duly showed the said same. However, this Hon'ble Court has been pleased to further ask the appellant that why the said documents were not filed in the trial Court. In this regard, it is submitted that the said documents were filed by the appellant in the trial Court, but learned trial court has been pleased to detach the said documents. Even the said documents has already been mentioned in the list of documents filed before the learned trial court. As such there was no fault on the part of the applicant/appellant.
3. That this is very unfortunate for the appellant that on the one hand the learned trial court ordered to the appellant to detach the said documents and when the said documents were detached from the said list of documents, at the time of dismissing the suit, the same was dismissed on the ground of non filing of the said document i.e. Registration Form on the court record."
(emphasis supplied)
19. The stand taken by the appellant in the second application under Order 41 Rule 27 CPC (filed on 01.08.2012) is rather curious. In this application the appellant has averred that it had filed its certificate of registration in the Trial Court but the Learned Trial Court has 'detached' the said document from the Trial Court record although the said documents were mentioned in the list of documents in the Trial Court. The appellant has averred that it was the Trial Court which ordered the plaintiff to detach the document from the list of documents at the time of dismissing the suit.
20. The stand of the appellant in both its applications are at variance. In the first application the appellant had claimed that it had filed its certificate of registration before the Trial Court which failed to consider the same. In the second application RCA No. 60/11 7/11 the appellant has contended that it had filed the said document in the Trial Court but the Learned Trial Court ordered the said document to be 'detached' from the Trial Court record.
21. As recorded, issues no. 1 and 2 were decided in favour of the plaintiff. The defendant has not filed any cross objections or appeal against the said findings. The same have therefore attained finality. The suit of the plaintiff was dismissed on the sole ground that it had failed to prove its certificate of registration and the suit was barred under the provisions of Section 69 (2) of the Partnership Act. The outcome of this appeal hinges on the outcome of the prayer of the appellant for leading additional evidence to prove its certificate of registration.
22. Order 41 Rule 27 of the CPC regulates the procedure for leading additional evidence at the stage of appeal. Order 41 Rule 27 CPC provides that ordinarily no party to an appeal is entitled to lead additional evidence but a party may be permitted to lead additional evidence under three circumstances. The first circumstance is where the Court against whose decree the appeal has been preferred has refused to admit such evidence. The second circumstance is where the party despite exercise of due diligence could not produce the evidence before the Trial Court. The third circumstance is where the Appellate Court requires any document to be produced or witness to be examined to enable it to pronounce judgment or for any other substantial cause.
23. Order 41 Rule 27 of the CPC has been subject to several decisions of the Hon'ble Supreme Court. In the case of Union of India versus Ibrahim Uddin and Anr. reported in 2012 (8) SCC 148, the Hon'ble Supreme Court has been pleased to reiterate the law in this regard. The Hon'ble Supreme Court was pleased to hold that the general principle of law was that the Appellate Court should not traverse outside the record of the lower Court and would not take evidence in appeal. However, Order 41 Rule 27 of the CPC enabled the Appellate Court to take in additional evidence in exceptional circumstances. It was held that only if the party to the appeal fulfilled the conditions laid down in the rule such additional evidence could be taken in appeal. It was held that a party to an appeal is not entitled as a matter of right to admission of additional evidence and the provision does not apply where on the basis of evidence on record, the Appellate Court can pronounce a RCA No. 60/11 8/11 satisfactory judgment.
24. I have gone through the Trial Court record. The certified copy of Form A is not on the file of Trial Court. The plaintiff had examined Sh. Venus Kumar, its partner as PW-1 who deposed by way of affidavit Ex.PW1/A. This affidavit was tendered in evidence on 30.08.2008. This witness had relied on the following documents:-
i. Bill dated 01.06.2003 as Ex.PW1/1;
ii. Bill dated 07.06.2003 as Ex.PW1/2;
iii. Ledger Account as Ex.PW1/3;
iv. Carbon copy of legal notice as Ex.PW1/4;
v. Postal receipt as Ex.PW1/5;
vi. UPC receipt as Ex.PW1/6 and ;
vii. AD Card as Ex.PW1/7.
25. No other document was exhibited or relied upon by PW-1. Sh. Venus Kumar, was subjected to cross examination by the counsel for the defendant on 30.08.2008. In his cross examination PW-1 has deposed that "it is correct that no certificate of registration of the Partnership Firm has been placed by me on the judicial file". PW-1, Sh. Venus Kumar thus admitted before the Learned Trial Court that he had not filed his certificate of registration Form A before the Trial Court. Thus the contention of the appellant in its first application under Section 151 CPC that the document was produced and filed in the Trial Court is contrary to the record.
26. In its second application, the appellant had claimed that the document Form A was filed in the Trial Court but it was the Ld. Trial Court which had directed the plaintiff to detach it from the list of documents. This contention is again contrary to the record of the Trial Court as PW-1 in his cross examination clearly admitted that he has not filed the certified copy of Form A on record.
27. The Trial Court record further reveals that the plaintiff filed its suit along with list of documents. The list of documents filed by the plaintiff on 24.08.2006 is on record. It mentions only seven documents. These are as under:-
i. Carbon copy of legal notice dated 15.12.2005;RCA No. 60/11 9/11
ii. Photocopy of postal receipt;
iii. Photocopy of UPC;
iv. Original AD Card;
v. Photocopy of bill dated 01.06.2003 bearing no. 1204; vi. Photocopy of bill dated 07.06.2003 bearing no. 1205; vii. Copy of ledger account.
28. The list of documents filed by the plaintiff does not mention certified copy of Form A. Thus the submission of the appellant in its second application that the certified copy of Form A was filed along with list of documents before the Trial Court is also contrary to the record.
29. Thus the grounds mentioned by the appellant in both its applications for permission to lead additional evidence have not been made out. It appears to this Court that there may have been some negligence on the part of the appellant / plaintiff or his counsel in not producing this document before the Trial Court which resulted in dismissal of the suit. By these applications the appellant has attempted to cover up such negligence. In the case of Union of India versus Ibrahim Uddin and Anr. 2012 (8) SCC 148, the Hon'ble Supreme Court has specifically held in para no. 40 as under:-
"40. The inadvertence of the party or his inability to understand the legal issues involved or the wrong advice of a pleader or the negligence of a pleader or that the party did not realise the importance of a document does not constitute a "substantial cause"
within the meaning of this Rule. The mere fact that certain evidence is important, is not in itself a sufficient ground for admitting that evidence in appeal."
29. The Hon'ble Supreme Court in the case of Union of India versus Ibrahim Uddin and Anr. (Supra) has clearly held that inadvertence of the party, inability to understand legal issues, wrong advice of pleader, negligence of pleader, or a party not realizing the importance of a document does not constitute 'substantial cause' RCA No. 60/11 10/11 within the meaning of Order 41 Rule 27 of the CPC.
30. It is not the case of the appellant that it was not in possession of its certificate of registration at the time of filing of the suit. Having failed to produce its certificate of registration before the Trial Court, the appellant cannot be permitted to lead additional evidence to prove the same at the stage of appeal. Thus for the reasons recorded above, the application of the appellant under Section 151 CPC (filed on 20.09.2011) and under Order 41 Rule 27 CPC (filed on 01.08.2012) both praying for permission to lead additional evidence have no merit and are dismissed.
31. Now coming to appeal, as recorded the Learned Trial Court decided issue no. 1 and 2 in favour of the plaintiff and dismissed the suit since issue no. 3 could not be proved. The plaintiff could not prove that it is partnership firm was registered with Registrar of Firms. Section 69 (2) of the Partnership Act provides that "no suit to enforce a right arising from a contract shall be instituted in any Court by or on behalf of a firm against any third party unless the firm is registered and the persons suing are or have been shown in the Register of Firms as partners in the firm". Thus in the absence of registration with the Registrar of Firms, a suit by a partnership firm against a third party is barred. The plaintiff has failed to prove that it is registered with the Registrar of Firms. Suit of the plaintiff was therefore not maintainable and has been rightly dismissed by the Learned Trial Court.
32. Appeal of the appellants has no merit and is dismissed. File be consigned to Record Room.
33. TCR be sent back with a copy of this Order.
Announced and Dictated to the Steno in Open Court today i.e. 02.04.2013 (REETESH SINGH) Addl. Distt. Judge-01 (NE) Karkardooma Courts, Delhi RCA No. 60/11 11/11