Delhi District Court
At Present Available At:38 vs M/S Samsung Corporation on 28 July, 2008
IN THE COURT OF SH M.R.SETHI:
ADDL.DISTRICT JUDGE: DELHI
Date of Institution: 03.03.2005
Date of Arguments: 14.07.2008
Date of Judgment: 28.07.2008
Suit No.30/05
M/s Shree Vinayaka Engineering (P) Ltd.
A company duly incorporated under the
Indian Office at 304305, Chouwdhary
complex 9, Veer Savarkar Marg,
Delhi110092, through its Director
Mr Sanjeev Kohli.
At present available at:38, Ram Vihar,
Delhi110092.
...........Plaintiff
1
Versus
M/s Samsung Corporation,
(Engineering and Construction Group),
through its Principal Officer,
Room no. 255, Taj Palace Hotel,
S.P.Marg, Diplomatic Enclave,
New Delhi110021.
ALSO at
1 Hydel Colony Hat, Dharchula,
P.O. 262545, Pithoragarh,
(UTTRANCHAL)
AT: 133, G.F. Uday Park,
Near Niti Bagh,
New Delhi110049.
......Defendant
2
SUIT FOR RECOVERY OF Rs.19,90,000/
J U D G M E N T:
1 Present is a suit for recovery of Rs.19,90,000/ filed by plaintiff claiming to be a private limited company. It was claimed that the plaintiff company was a reputed and experienced company in the filed of manufacturing construction engineering products included Rock Bolts, Steel Ribs etc and had expertize in manufacturing the same. The defendant was claimed to be a multi national company engaged amongst others in construction of Civil work of Power Station and 3 Waterways. It was claimed that National Hydroelectric Power Corporation Limited (N.H.P.C) entered into a contract with defendant and M/s H.C.C for construction of Power Station and Waterways for Dhauliganga Hydro Electric Project. It was a joint venture of defendant and HCC and the defendant was controller of the job for constructing Waterways (Tunnels ) and allied jobs. As per claim of the plaintiff, as per the contract entered into between NHPC AND defendant and M/s HCC, the defendant was/is entitled to charge and claim the value of minimum 1100 Metertic tone of Steel Ribs. Such representation was claimed to have been made 4 by defendant to the plaintiff before starting the business dealings. The defendant was claimed to have entered into contract with plaintiff at Delhi. It was claimed that the contracts have been broken by the defendant and substantial and real loss/ damages have been caused to the plaintiff. It was claimed that the defendant was liable to make good the loss and damages and pay to the plaintiff the amount as claimed in the present suit.
2 As per facts as mentioned in the plaint, the defendant vide its letter dated 3.11.2000 made inquiries from plaintiff for the rates etc for arranging supply of cement which 5 amongst others included "Shree Cement" . It was claimed that after holding inquiries regarding the rates and after telephonic discussions, the plaintiff vide its letter dated 14.11.2000 offered to provide services for arranging supply of Shree Brand Cement to defendant. The said offer made by the plaintiff was claimed to have been accepted by the defendant vide its letter dated 3.7.2001 and order was claimed to have been placed for arranging supply of 4692 bags of offered Cement i .e. Shree Cement. It was claimed that as per the agreed terms, the payment for the cost/value of offered cement was to be directly paid to the agent of Shree Cement 6 manufacturer and the cost of transportation was to be paid to the plaintiff. The cement was to be supplied by manufacturer @ Rs.140/ per bag F.O.R Tanakpur. From Tanakpur, the cement was to be transported by plaintiff to the site while charging Rs.42/per bag. As per claim, the payment for the supply of cement was to be made by defendant directly to the agent of Shree Cement i. e M/s Super Agencies . Defendant was claimed to have issued and paid a cheque of Rs.6,56,880/ in favour of M/s Super Agencies on approval of the purchase order. It was claimed that in compliance thereof, M/s Shree Cement dispatched the first consignment of 3780 bags to defendant. 7 Advance information in this regard was claimed to have been given by plaintiff to the defendant vide its letter dated 13.7.2001 informing that the said consignment of cement bags had been dispatched by the seller to Tanakpur. It was claimed that the consignment of 3780 bags started reaching the destination and were to be transported by plaintiff to Dharchula in due course, and plaintiff started transporting the same to Dhauliganga in lots. The defendant was claimed to have taken delivery of 410 bags of cement against acknowledgment given to the transporter. It was further claimed that another batch of 700 bags of cement was also 8 taken delivery of by defendant without knowledge of plaintiff and without any acknowledgment to the plaintiff. Acknowledgment in respect of 700 bags was claimed to have been given by representative of defendant on Excise ChallancumInvoice dated 10.7.2001. It was claimed that till that time plaintiff was under bonafide belief that only 410 bags of cement were delivered to the defendant. As per allegations, after taking delivery of the said bags of cement, the defendant refused to take further delivery on the pretext that they had ordered Vikram Cement. It was claimed that this refusal of defendant was illegal and was in breach of 9 contract . It was further stated that defendant refused to take delivery of 480 bags of cement transported to Dhauliganga by the plaintiff. It was claimed that it was only after September,2001 that plaintiff came to know regarding delivery of 700 bags having been received by the defendant. As per plaintiff, 2190 bags of cement lying at Tanakpur and 480 bags at Dharchula were agreed to be sold in the market by the plaintiff under duress and undue pressure of defendant as it was not releasing the payments/ dues of plaintiff and was so made to give adjustment of the payments made to M/s Super Agencies and the plaintiff. Plaintiff claimed that it was under no 10 obligation or contractual liability to dispose off the said unaccepted bags of cement. Plaintiff claimed having sold the same in the market at a loss of Rs.2,39,000/. As per claim of the plaintiff, the defendant neither gave credit for the 1110 bags of cement or for the loss of Rs.2,39,675/suffered by the plaintiff nor had paid the said amount to the plaintiff. On basis thereof plaintiff assessed the loss to be Rs. 4,41,695/.
3 It was further claimed by the plaintiff that it was being assured by the defendant that the order of Steel Ribs could be more than 1100 M. Tone and that defendant 11 had given an advance of Rs.3,00,000/ to plaintiff for purchasing machines required exclusively for manufacturing Steel ribs and Rock Bolts. As per claim of the plaintiff, vide letter dated 11.5.2000, defendant had invited from the plaintiff competitive rates for the Steel items and that during course of negotiations between the parties, the rates etc. submitted by plaintiff vide its letters dated 5.8.2000 were approved by the defendant vide its letter dated 11.11.2000. It was claimed that all the negotiations took place and were finalized at Delhi. Plaintiff further claimed having purchased machinery worth Rs.9,32,950/required exclusively for 12 manufacturing Steel Ribs and also claimed having purchased other machineries worth Rs.2,12,800/ for the manufacturing the Rock Bolts etc. Total cost in this regard was claimed to be Rs.11,45,750/. The said machinery and tools etc were claimed to have been sent to defendant vide challan dated 14.12.2000 under authority of Form No. 31 issued by defendant for transporting and delivery of the same to defendant at its site at Dhauliganga project. It was claimed that Form 31 could be issued by defendant only when the goods, items as mentioned in challans were to be taken delivery and control of by the defendant. It was claimed that as there was no 13 sale of machinery which was sent on returnable basis, value of the machines were shown at reduced amount. The generator etc were also claimed to have been sent to defendant separately vide challan dated 17.12.2000 on basis of Form No.31 issued by defendant. As per claim of the plaintiff, by virtue of Form No.31, the transported material was to remain under the control of the defendant and the defendant was to be its custodian and was to retain its possession until it was returned to its owner/sender or account was given regarding the same. It was further claimed that against the heavy investments and monthly expenditure to the tune of 14 Rs.76,000/, the defendants were placing orders for an average billing of less than Rs.50,000/per month. The total orders during December,2000 to September,2003 for manufacturing of Steel Ribs was claimed to be to the tune of about Rs.1,06,641= 80P. Plaintiff was claimed to have approached the defendants in this regard vide letter dated 3.9.2002 which was claimed to have been replied by the defendant vide its reply dated 15.9.02. It was claimed that as the defendant had not refused to require the Steel Ribs, requirement of the same was alive, and it clearly meant regular maintenance and payment to technical staff which was kept at 15 the site and paid for the urgent requirements of the defendant by the plaintiff. Plaintiff was claimed to have reapproached the defendant in this regard vide letter dated 17.9.02. It was claimed that thereafter the communication between the parties was over telephone only and that the defendant continued to give assurance of giving orders for Steel Ribs etc but only orders for some Rock Bolts were given. It was further stated that thereafter the plaintiff was telephonically informed by the defendant that plaintiff need not expect any further orders from the defendant. The said stand of defendant was claimed to be in clear breach of the contract entered into between the 16 parties. It was claimed that plaintiff decided to first remove its heavy machines, sheds etc from the site and in this regard letter dated 01.11.2003 which was delivered to the defendant on 17.11.2003 was sent, wherein request was made for return of machineries and properties of plaintiff, but, the defendant failed and orally refused to hand over the possession of the machines or meet the demands of plaintiff. It was claimed that upon this, plaintiff summoned back its three technical staff kept at the spot for manufacturing Steel Ribs. Plaintiff also claimed having relieved other staff, workers and labours from the job, but as they were 17 required by defendant, they were requested by the defendant to continue working for sometime with assurance to pay their salaries. It was claimed that after the letter dated 01.11.2003, the defendant was approached several times to settle the matter, but without any result. Legal notice was claimed to have been sent to the defendant in April.2004 asking the defendant to pay dues of the plaintiff and return machinery etc. Reply dated 10.7.04 was claimed to have been sent by the defendant in this regard. It was claimed that the defendant had no intention to return or hand over machineries or properties of plaintiff for reasons best known to them. Plaintiff claimed 18 having sent its representative on 28.10.2004 to bring back its machines and the shed material etc. It was claimed that the properties could be transported only on giving of necessary permission by the defendant and on issue of a written permission i.e delivery challan etc by the defendant. It was further claimed that on 28.10.04 when representative of the plaintiff went to the site, the machinery was not found there and the representative was sent back without delivering the machines of the plaintiff. Thereupon, it was claimed, that as a matter of abundant precaution, plaintiff vide its letter dated 5.11.2004 called upon the defendant to fix a date and time for the 19 plaintiff to send its representative to take back delivery of its machines and the shed material. It was claimed that despite service of the said letter, the defendant did not grant permission to plaintiff to bring back or remove its machinery lying in possession and under control of the defendant at the site. The machines, it was claimed, were of the value of Rs.9,32,950/ and were required only and exclusively for manufacturing the steel ribs and were subjected to depreciation by acts of the defendant. Plaintiff claimed that on account of breach or fault of the defendant, plaintiff had suffered huge losses and was hence entitled to the amount of depreciation 20 plus interest @ 12% p. a. w. e .f 01.12.2000 to 31.12.2004 on the value of the machine till filing of the suit and return of machines/properties of the plaintiff or its depreciated value . It was claimed that against the value of machines, generator, shed etc plaintiff was entitled to sum of Rs. 13,90,274/ and further sum of Rs.1,10,446/ regarding the machinery for the rock bolts. Plaintiff further claimed having deployed its technical staff at the spot which were paid salary for about 34 months to the tune of Rs.4,42,000/. Amount claimed in that regard was stated to be Rs.4,77,504/. It was claimed that the machines, equipments, generator etc were to 21 be returned only in working and running conditions and the conditions in which the same were left in the control, custody and possession of defendant on 30.9.03. That on failure of the defendant to return the same, defendant was claimed to be liable to pay their value to the plaintiff. The total amount, which as per claim of the plaintiff was recoverable from the defendant was Rs.24,72,307/ . Plaintiff claimed that it was giving up its claim for amount of Rs.4,82,307/ and was filing the suit for recovery of Rs.19,90,000/ alongwith interest @ 12 % p. a.
4 After summons of the suit were 22 served upon the defendant, defendant filed its written statement wherein it was claimed that the suit filed by plaintiff was false, bogus and mischievous. It was claimed that this court did not have territorial jurisdiction to try the present suit as no part of alleged cause of action had arisen within jurisdiction of this court. Allegations made by the plaintiff in the plaint were denied by the defendant. It was claimed that the plaintiff of its own had installed its workshop at Dobat which was 10 Km away from the site of the defendant and that all the machineries and tools were received by representative of the plaintiff. It was claimed that defendant was never the 23 custodian nor in possession of materials transported by the plaintiff. It was further claimed that as plaintiff had not supplied the required material in time due to non cooperation of its staff, the defendant was unable to progress with its work and had to suffer losses. It was claimed that vide letter dated 15.9.2002 defendant had clearly mentioned to the plaintiff that its order was for Vikram Cement. It was further claimed that it was only on request of the plaintiff that defendant had accepted only 410 bags of Shree Cement and further that representative of the plaintiff had been duly informed that only Vikram Brand Cement was acceptable and that 24 if Shree Brand Cement shall be supplied, it shall be refused. The said fact was claimed to have been mentioned by plaintiff in letter dated 16.7.2001. It was further claimed that question of handing over machines etc to the plaintiff did not arise as the same were in possession of plaintiff and the plaintiff had taken away its machines and tools after vacating the workshop. It was denied that the same were ever in possession of the defendant. It was further mentioned that plaintiff had not paid wages to its workers regarding which the workers had complained to NHPC and the Assistant Labour Commissioner. That as the defendant was the Contractor of NHPC and 25 plaintiff was the Subcontractor of the defendant, NHPC vide their letter dated 4.9.2003 informed the defendant that salary arrears of Rs.1,11,600/ be paid to the labourers failing which NHPC threatened to disburse the wages from the monthly bill of the defendant. It was claimed that workers of the plaintiff had stopped work on account of failure of plaintiff to pay their salaries. 5 In the additional pleas taken by the defendant in the written statement, it was claimed that the defendant had paid to the plaintiff sum of Rs.8,53,944/ towards cost of cement and that the plaintiff vide its letter 26 dated 18.9.2001 had accepted that after deducting the amount of Rs.74,620/ towards cost of 410 bags of cement, balance of Rs.7,79,324/ was balance of defendant with plaintiff and plaintiff had requested to defendant to debit the said balance amount in the manner mentioned in the said letter. It was further claimed that vide its letter dated 30.9.2002 plaintiff had appealed to the defendant for placing more orders and mentioned that if no further job was available, plaintiff shall use the machine elsewhere. By this, it was claimed that machines were in possession of the plaintiff. It was further claimed that installation of machines near the 27 site was on insistence of the plaintiff and not on asking of the defendant. It was prayed that the suit be dismissed.
6 Thereafter replication was filed on behalf of plaintiff wherein allegations made in the written statement were denied and facts mentioned in the plaint were reiterated. 7 On the pleadings of parties, the following issues were framed by my Ld Predecessor: ISSUES:
28
1) Whether this court has territorial jurisdiction to try this suit? OPP
2) Whether the sets of machineries, generators, sheds etc. were delivered by the plaintiff to the defendant and if yes, whether the same are still in the possession of defendant? OPP
3) Whether the plaintiff is entitled to the amount claimed, if yes, at what rate of interest? OPP
4) Relief.
8 The plaintiff in support of its claim had filed evidence by way of affidavit of its Director Shri Sanjeev Kohli who was examined 29 as PW.1. PW.1 duly proved his affidavit Ex PW1/A and also documents Ex PW.1/1 to PW.1/42.
8A During course of crossexamination by learned counsel for defendant, witness claimed that the defendant had called them on telephone for manufacture of still ribs and rock bolts and no representation was given to him in writing except for copy of contract Ex PW1/1. He denied the suggestion that defendant company had no registered office in Delhi. He again said that although he did not know about the registered office in Delhi, the defendant had an office in Delhi. He denied the 30 suggestion that the premises which he was describing as office of defendant in Delhi was not an office infact but a place to use as residence for officers of defendant' s company.
He admitted that no order of supply of cement was placed by defendant company upon the plaintiff and that the order was placed by defendant company upon M/s Super Agencies and the plaintiff only had to transport the cement. The quoted rates of cement were claimed to have been sent to the defendant by hand vide Ex PW1/3, but the witness admitted that there was no acknowledgment of the same from the defendant company. He denied the suggestion that they had not sent Ex PW1/3 to 31 defendant company. He further denied the suggestion that vide Ex PW.1/4 plaintiff was asked to supply cement by the defendant company. He claimed that plaintiff was only asked to transport cement. Witness admitted that he had not placed any document on record regarding placing of an order of supply of cement by defendant to M/s Super Agencies. He claimed that the defendant had ordered Shree Brand Cement and that name of the brand was not conveyed in writing but was conveyed orally. He further stated that after receipt of Ex PW1/4 plaintiff did not write any letter to the defendant company asking defendant to specify brand of cement to be 32 supplied. He denied the suggestion that only 410 bags of Shree Cement were delivered by the plaintiff at the site of defendant. He denied the suggestion that defendant had not ordered Shree Brand Cement but had ordered Vikram Brand Cement and, therefore, was right in refusing delivery of cement. He further denied the suggestion that there was no contract executed with defendant for supply of Shree Brand Cement. He denied the suggestion that since no breach of agreement was committed by the defendant, he was not entitled to any amount on this ground from the defendant. He admitted that plaintiff had not got any advertisement for auction/sale of 2670 33 bags of cement in any newspaper nor did it invite the tenders for such sale/auction. He denied the suggestion that rates of the cement bags mentioned in para 37 of his affidavit were imaginary and on very lower side. He further denied the suggestion that in fact the cement fetched price more than what was stated by him or that the customers mentioned in invoices Ex PW1/11 were fictitious and imaginary. He claimed having sent the letter Ex PW1/12 by hand but claimed that he did not have any acknowledgment for the same. He claimed that the assurance referred to by him in para 44 of his affidavit was verbal and denied the suggestion that no such assurance 34 was given at any point of time by the defendant to him. He denied the suggestion that he had installed the machines referred in para 51 of his affidavit at the site of defendant of his own wish. He further denied that as per the contract he was to install machinery at the site of defendant for manufacture of ribs and bolts and claimed that it was defendant's requirement. He further claimed that the terms & conditions under which he was to manufacture the ribs &bolts and supply the same to the defendant were contained in Ex PW1/15, PW.1/16 and Ex PW1/17 and that no change was effected in the aforesaid terms & conditions thereafter. He admitted that it was 35 only his staff/workers who were operating the aforesaid machines. To a specific question the witness replied that till September, 2003 no workers /official of the defendant ever worked or operated the aforesaid machines installed at the site. He claimed that the workers employed by him to operate the aforesaid machines used to sleep/rest in the hutment near the tin shed. He denied the suggestion that the machines were under the control of the workers employed by the plaintiff or that the defendant, its employees or workers had no concern whatsoever with the machines and the tin sheds. He admitted that there was no document to the effect that the defendant had 36 control of the said machines and the tin shed. He further claimed that except for documents Ex PW.1/27 , PW1/28, PW1/29 & Ex PW1/31, there was no document requiring the plaintiff to hand over the said machines to defendant at Delhi for being carried to Dharchula site. He denied the suggestion that as per agreement, plaintiff was to transport machinery itself to Dharchula site and install there on its own. He further denied the suggestion that plaintiff itself carried the machinery from Delhi to Dharchula site and installed it there. He further denied the suggestion that the documents Ex. PW1/27 to Ex PW1/31 were sham documents and manufactured only for 37 saving tax. He claimed that original of documents Ex PW1/28 to Ex PW1/31 were with the defendant. It was claimed by the witness that it was from document Ex PW1/29 that he stated that delivery of the consigned goods were taken by the defendant company. He admitted that there was no signature or seal of the defendant company in acknowledgment of consignment of goods. He denied the suggestion that the plaintiff had consigned machinery from Delhi to Dharchula site and taken the delivery itself at the site. He further denied the suggestion that defendant had no concern whatsoever with the consignment and transportation of machinery from Delhi to the 38 site. He further denied the suggestion that it was plaintiff alone who was aware of whereabouts of the machinery or that defendant was completely ignorant of the same. He denied the suggestion that plaintiff had removed the aforesaid machinery from Dharchula site and has filed a false claim regarding those machineries. He admitted that there was no document to the effect that defendant ever stopped the petitioner to remove the machinery from the site. He denied the suggestion that no person was sent by the plaintiff on 28.10.04 to take delivery of the machinery or that plaintiff had removed the machinery before the said date. He admitted 39 that there was nothing in the terms and conditions as contained in Ex PW1/15 to PW1/17 as to who would be responsible for the loss or damage to the machinery installed at the site. He further admitted that there was nothing in those documents entitling the plaintiff to claim the salary given to its employees from the defendant. He admitted that he had not produced any salary register or the attendance register regarding distribution of salary at the site. He denied the suggestion that voucher Ex PW1/38 were false and fabricated or the entire suit and claim was false or that nothing was due from defendant to plaintiff.
40 9 The defendant in its defence had examined Shri Young Hun Choi as DW.1. Witness proved his affidavit Ex DW1/X and also placed on record some documents and statement of account Ex DW1/2.
9A During course of crossexamination by learned counsel for plaintiff, witness claimed that he was Project Manager of defendant since 20032004. He admitted that during the period of dealings between the parties, he was never in picture nor any correspondence was exchanged by him with the plaintiff company. He claimed that during the relevant period Mr. C.H. Lee was the Project 41 Manager of the defendant company. He admitted that defendant company had undertaken a contract for construction at Dhauliganga and Ex PW1/1 was executed and signed between NHPC and defendant company at Delhi. He claimed that as he was at the site, he was not aware if the plaintiff company was approached at Delhi for purpose of manufacturing steel ribs and rock bolts after execution of Ex PW1/1. He claimed that Mr. S. M. Lee and Mr C.H. Lee were the persons at Delhi who were controlling the affairs of the defendant company from Delhi. He admitted that discussions with regard to manufacturing steel ribs and rock bolts took place in Delhi 42 between the representative of defendant company and the plaintiff. He further stated that although as per original contract with NHPC about 1100 metric tonnes of steel ribs were stated to be required for the project,the exact requirement could vary depending upon the rock condition. He denied the suggestion that defendant company was required to charge minimum of 1100 metric tonnes of steel ribs. He denied the suggestion that assurance was given to the plaintiff company that a minimum of 1100 metric tonnes are required to be manufactured at the site. He claimed that as far as he could say Ex PW1/13 was written by the defendant company to the 43 plaintiff from Delhi and during the relevant period office of the defendant company was at 86A, Sainik Farm, New Delhi as given in Ex PW1/13. He denied the suggestion that to start with, the defendant company had placed an order for manufacturing of 533 metric tonnes of steel ribs. He admitted that Ex PW1/17 was written by the defendant to the plaintiff from Delhi office at Safdarjung Enclave. He further stated that in the beginning letters between plaintiff and the defendants were exchanged at Delhi but later on the work order was given at the site. He denied the suggestion that the defendant company was told that heavy machinery are required to be transported to 44 the manufacturing site for the purpose of work in question. Ex DW1/P1 & P2 were claimed to have been received by the defendant company at Delhi. Ex DW.1/P3 was also claimed to have been written by defendant from Delhi. He further claimed that Ex PW1/2 was sent by the defendant company and that the five companies mentioned in Ex PW1/2 were the actual companies approved by NHPC. He admitted that plaintiff could have supplied the cement of any of these five manufacturers. He could not say if Ex PW1/3 was received by defendant company. He claimed that he did not know if the payment for cement supply against 4692 bags of Vikram Cement was made 45 directly to M/s Super Agencies. He did not remember if letter Ex PW1/5 was received by their company and could not say if Ex PW1/6 had been signed at point A encircled red by their Security Guards. He further claimed that as per documents on record, payment for the cement was made directly to the supplier M/s Super Agencies by the defendant. He expressed ignorance as to whether or not any letter dated 13.7.2001 ( Ex PW1/5) was sent by plaintiff to the defendant before dispatch of cement. He claimed that he was not aware whether or not this letter was received by Fax at Delhi office of the defendant. Witness further stated that as per records perused by him, defendant had 46 only received 410 bags of cement from the plaintiff. He could not recollect name of the security guard at Dharchula and claimed that he could not say if one Kishore was posted as Security Guard there at the relevant time. He further stated that 700 bags of cement as mentioned in Ex PW1/6 might have been received by their security guard. Witness volunteered that after 410 bags have been received by them, they had told the plaintiff not to send any further cement bags of Shree Brand and it appeared that 700 bags were received by their security guard who was not aware about the said fact. Witness further claimed that he thought that those 700 bags 47 had been returned to the plaintiff by defendant. However, he could not tell the date of return of those bags. He further stated that he could not say whether or not they had not proved regarding the plaintiff having received back the said 700 bags. He admitted that factum of 700 bags having been returned back to the plaintiff by the defendant was neither mentioned in the written statement nor in his affidavit Ex DW1/X. Witness admitted that the amount mentioned in Ex PW1/8 i.e Rs.8,53,944/ had been shown as having been paid to the plaintiff vide entries Mark A & B dated 31.3.2002 of DW.1/2. He claimed that he could not say whether or not value of 410 bags 48 of cement admittedly received by the defendant had been reflected in Ex.DW1/2. He denied the suggestion that value of 1110 bags was never reflected in their statement of account. He claimed that he had no knowledge if out of 4692 bags of cement ordered, 3780 bags had been sent by plaintiff to Tanak Pur or if out of those 3780 bags, 2670 bags were sold by plaintiff at a loss at Tanak Pur and Dharchula. He denied the suggestion that as the defendant had not issued 'C' Form to the supplier M/s Super Agencies, therefore, the said supplier did not supply the remaining quantity of cement bags. Witness admitted that plaintiff was to manufacture steel ribs and 49 rock bolts at their workshop at Dobat which was at a distance of less than 10 Km from the project site. He claimed that as he was not aware, he could not say if heavy machinery was required for manufacturing steel ribs and rock bolts. He denied the suggestion that machinery mentioned in Ex. PW1/27 was delivered to defendant vide Ex PW1/28 for being taken to the work site. He claimed that Ex PW1/28 had been issued to the plaintiff for shifting their equipments to the work site. It was claimed that the documents produced before the defendant by the plaintiff used to be endorsed by the defendant as the defendant being a foreign concern was not aware about 50 the documentation required for shifting machinery etc. Witness claimed that he cannot say whether or not machinery could be shifted from Delhi to the work site without execution of document Ex PW1/28. He claimed that he was not in Delhi at the time of execution of Ex PW1/28 or at the time of alleged delivery of machinery to the defendant vide Ext.PW1/27 or even at the time of transportation of machinery, as he was at the work site. He denied the suggestion that the defendant was the consignee of the said machinery. He denied the suggestion that second lot of machinery was received by the defendant from the plaintiff vide Form No. 31 ( Ex PW1/31) having 51 been sent vide delivery challan Ex PW1/30 to transport companies G.R ( Ex PW1/29). Witness claimed that in fact defendant had only affixed its stamp on Ex PW1/31 to facilitate the plaintiff to transport the machinery from Delhi to the site. Witness admitted that he was not in Delhi at the time of execution of these documents. He further admitted that he was personally not in the picture at the time of handing over of machinery/delivery of machinery or at the time of issuance of Form No.31 or at the time of preparation of the delivery challan or at the time of transportation of machinery. He claimed that he could not tell value of the 52 machinery. Witness admitted that some machinery did reach the site but he could not tell details of the same. He denied the suggestion that machinery mentioned in documents Ex DW1/PA and PB had been received by defendant at the site. Witness further stated that he could not say if machinery brought to the site by virtue of Form No.31 could be taken from the site back to Delhi only with an authorization from the defendant. He claimed that as far as he knew, the defendant had never issued authorization in favour of plaintiff for transportation of any machinery back to Delhi from the site. On seeing document Ex PW1/33 witness claimed 53 that he could not say as to whose signatures appeared at portion encircled Mark X of the same. Witness claimed that land at the site had been taken on rent by defendant. He further stated that earlier they had engaged a Security Guard at the site, but once the plaintiff came there, the Security Guard was removed. He could not tell the date when the security guard was removed. He denied the suggestion that they had never removed the security guard and that he always remained present at the site even after plaintiff came to the site. He further denied the suggestion that goods of defendant always remained stored at the site land. He could not tell the date when 54 machinery was removed from the site by the plaintiff nor could he tell name of the person who removed the machinery. He denied the suggestion that no Incharge of plaintiff was posted at the site or that none had removed the machinery on behalf of the plaintiff. He could not tell the number of employees employed by the plaintiff at the site of manufacturing steel ribs and rock bolts. Witness claimed that some of the employees of plaintiff had remained employed at the site till 492003 and that prior to the said date,defendant had never communicated with the plaintiff to remove its employees and machinery from the site as the same were no longer required at the site. He 55 claimed that infact the defendant was not required to communicate with the plaintiff in that regard. Witness denied the suggestion that till date the machinery was lying with the defendant or that the same had not been returned by defendant to the plaintiff. He further denied the suggestion that defendant was liable to pay damages to the plaintiff for the losses incurred by plaintiff as claimed in the plaint. He denied the suggestion that he was deposing falsely.
10 After evidence of parties was concluded, arguments were advanced by learned counsel for plaintiff and learned 56 counsel for defendant. The main line of arguments advanced by learned counsel for plaintiff was that claim of the plaintiff was based on three broad factors i.e the loss suffered for the cement; loss of machines and the loss incurred by the plaintiff towards wages of labours and the machinery lying idle on account of inaction of the defendant. Learned counsel submitted that plaintiff had supplied cement as per orders placed by the defendant but the defendant did not honour its commitment and had refused to take delivery on frivolous ground. It was submitted that although payment in respect of cement had been made by the defendant directly to the 57 supplier, the defendant had debited the entire amount from the bill of the plaintiff and had deducted the said amount illegally. During course of his arguments learned counsel took this court through the various documents relied upon by both the sides. It was submitted that plaintiff could have supplied any of the brands of cement agreed to between the parties and that the subsequent objection taken by the defendant regarding brand of cement was unfounded. It was further submitted that it was only on account of volume of business expected from the defendant that plaintiff had agreed to bear the losses in respect of the cement, but the said orders never came. 58 Learned counsel submitted that receipt of 410 bags of cement had been admitted by the defendant. It was submitted that another consignment of 700 bags had been duly received by representative of the defendant, although it was claimed that at that time plaintiff was not aware about the defendant having received the said consignment. On basis thereof it was submitted by learned counsel that plaintiff was entitled to cost of the said 1110 bags and was also entitled to recover the losses incurred by the plaintiff in selling the unaccepted bags of cement in open market. The loss, it was submitted, had accrued on account of acts/inaction of the defendant and plaintiff 59 should not be made to bear the said losses. As regards machinery, learned counsel submitted that machinery was transported near the site with the consent of the defendant and that it was the defendant who had taken delivery of the machines. It was further submitted that the machinery was under control of the defendant and had been misappropriated by the defendant from the site. Learned counsel drew attention of this court towards document on record regarding purchase of machinery and its transportation to the spot. Communications between the parties in respect of the machineries were also relied upon . It was further submitted that the defendant had 60 assured minimum order of 1100 metric tonnes of steel ribs and sufficient quantity of rock bolts for which the machinery had been taken to the spot for the said items to be produced near the site. Learned counsel submitted that labour and supervisory staff of the plaintiff had also been posted there to work on the machinery. As sufficient order was not placed by the defendant, it was submitted that loss had occurred to the plaintiff on account of the machinery lying idle at the spot and in respect of wages which had to be paid to the staff by the plaintiff. It was further submitted that as the machinery which was lying in custody and control of the defendant had been illegally 61 removed by the defendant, the defendant was liable to pay to and compensate the plaintiff in that regard.
11 Rebutting the arguments, it was submitted on behalf of defendant that the plaintiff had supplied Shree Brand of cement which had never been ordered. Learned counsel submitted that the defendant was fully justified in refusing to take delivery of cement which had never been ordered. It was further submitted that as per document Ex PW1/8 the plaintiff had agreed that the balance amount be debited to account of the plaintiff. It was further submitted that as per the said 62 admitted communication sent by plaintiff to defendant, there was no mention of delivery of 700 bags of cement (besides 410 bags) to the defendant. Learned counsel further submitted that the machinery had been transported from Delhi to the spot by the plaintiff of its own accord and not on request of the defendant. Learned counsel submitted that the machinery has always remained in power, custody and control of the plaintiff and its employees and that the defendant was never in control of the machinery, nor was responsible for the machinery vanishing from the spot. Ld counsel drew attention of this court towards various admitted and exhibited documents including 63 the communications between the parties. It was further submitted that as the defendant had already made payment of cement to M/s Super Agencies regarding the entire cement ordered, there was no question as to why the defendant would refuse to take delivery in case the cement being supplied was the cement ordered. It was further submitted that the plaintiff had miserably failed to prove the delivery of 700 bags of cement at any stage to the defendant. It was further submitted that PW1 had admitted that defendant had ordered Shree brand cement. As regards the other claims of the plaintiff, learned counsel submitted that although defendant was not 64 denying factum of machinery of plaintiff having reached the site, the same was always under control of the plaintiff and had infact been removed from the spot by representative of the plaintiff without information to the defendant. It was claimed that there was no breach of contract on part of the defendant. While referring to Ex PW1/9 learned counsel submitted that plaintiff infact had requested for withdrawal of the machines from the spot to be utilized elsewhere and had not asked for return of the machinery. It was submitted that plaintiff was not entitled to any sum of money from the defendant.
65 12 I have given my thoughtful consideration to arguments advance and have also perused the records.
13 On basis of submissions made on behalf of both sides and the evidence on record , my findings on the issues are as under: ISSUE NO:1 Whether this court has territorial jurisdiction to try this suit? OPP 14 In the written statement filed on behalf of defendant, a preliminary objection 66 had been taken to the effect that this court lacked territorial jurisdiction to try the present suit as no part of the alleged cause of action had arisen within the jurisdiction of this court. 15 Perusal of the evidence led on record reveals that during course of cross examination of DW1, it was specifically admitted by him that Mr S.M. Lee and C.H. Lee were the persons in Delhi who were controlling the affairs of defendant company from Delhi. He further admitted that discussions with regard to manufacturing steel ribs and rock bolts took place in Delhi between the representative of the defendant company 67 and the plaintiff. This witness further claimed that document Ex PW1/13 was written by defendant company to plaintiff from Delhi and at the relevant period office of the defendant company was at 86A, Sainik Farm,New Delhi as mentioned in Ex PW1/13. Documents Ex PW1/17 and DW1/P3 were claimed to have been written by defendant to plaintiff from Delhi office and documents Ex DW1/P1 and P2 were claimed to have been received by defendant company at Delhi.
16 As per provision of Section 20 CPC, a suit can be instituted in a court within local limits of whose jurisdiction the cause of action, 68 wholly or in part, arises. As per the explanation to Section 20, a corporation shall be deemed to carry on business at its sole or principal office in India , or , in respect of any cause of action arisen at any place where it has also a subordinate office, at such place. 17 In view of facts which have emerged on record specially during course of crossexamination of DW1, it is apparent that the defendant did have an office in Delhi and that part of cause of action had arisen in Delhi. As such, it is apparent that courts at Delhi have jurisdiction to try the present suit . 69
Issue No.1 is accordingly decided in favour of the plaintiff.
ISSUE NO:2 Whether the sets of machineries, generators,sheds etc were delivered by the plaintiff to the defendant and if yes, whether the same are still in the possession of defendant? OPP 18 As per case of the plaintiff, keeping in view the huge quantity of order expected and nature of the work to be done, machinery was installed near the site for manufacturing the Steel ribs and Rock bolts . Factum of installation of machinery and generator near 70 the site is not disputed by either of the parties. It was case of the plaintiff that machinery had been bought by the plaintiff for specific order placed by the defendant and had been duly sent vide Ex PW1/30 & 31. In this regard it would be pertinent to refer to cross examination of PW1 who during course of his crossexamination on 5.10.06 had specifically admitted that there was no signature or seal of the defendant company in acknowledgment of the consignment of the goods ( machinery). He had claimed that it was on basis of Ex PW1/29 that he was saying that delivery of the consigned goods had been taken by the defendant company. A perusal of the said 71 document reveals that there is no signature of anyone from side of the defendant in respect of having received the goods mentioned therein. It was PW1 who during course of his cross examination had admitted that till September,2003 no worker or official of the defendant had ever worked or operated the machines installed at the site and admitted that only his staff/workers were operating the said machines. He further admitted that his workers who operated the machines used to sleep/rest in the hutment near the tin shed constructed by the plaintiff itself. 19 During course of trial, no document 72 was placed on record, nor proved by the plaintiff, to show that the defendant had ever stopped the plaintiff from removing the machinery from the site. PW1 too had admitted that there was no such document to that effect. Admittedly, no document had been executed between the parties as regards custody or responsibility of machines installed at the site. The relevant documents in this regard i.e. Ex PW1/15, 16 & 27 are silent as regards custody of the machinery. 20 In para no.3 of the plaint, plaintiff had claimed that it was a known well established, reputed and experienced company 73 in the field of manufacturing rock bolts, steel ribs etc and had an expertize in manufacturing the same. This was specific stand of the plaintiff. It had further claimed that in order to execute the order placed upon it by the defendant, the plaintiff had purchased heavy machinery etc for performing the job work of the defendant. Although plaintiff claimed that the machinery was removed near the site on asking of the defendant, no documentary evidence to that effect was brought on record on behalf of plaintiff.
21 As per claim of the plaintiff it was in September,2003 that contract of 74 manufacturing and supplying steel ribs had been broken by the defendant. It was claimed on behalf of plaintiff that thereafter, it sent its representative alongwith letter dated 1.11.2003 requesting the defendant to hand over machinery and property of the plaintiff. It was claimed that despite receipt of said letter defendant had sent back plaintiff's representative without handing over machine to him. Thereafter, plaintiff was claimed to have sent a legal notice to the defendant in this regard. The said notice was claimed to have been replied on behalf of defendant vide reply dated 10.7.04 Ex. PW1/35. It was specifically mentioned in the said reply (Ex.PW1/35) that 75 the defendant had never instructed the plaintiff to install the machinery near the site and had never stopped the plaintiff from removing the machinery installed by the plaintiff for its own work. It was further case of the plaintiff that thereafter on 28.10.04 it had sent its representative to the spot who found the machinery missing from there. Letter in that regard ( Ex PW1/36) was claimed to have been written to the defendant by the defendant. The said letter is dated 5.11.04. 22 It is pertinent to refer to the aforesaid documents as the said documents lay bare the sequence of events that have taken 76 place from September,2003 to October,2004. As per admitted case of the plaintiff, it was in September,2003 that the defendant had broken the contract regarding manufacturing and supply of steel ribs. It appears that thereafter it took more than one year for the plaintiff to send its representative to take back the machinery from the spot. It would not be out of place to mention herein that vide an earlier letter dated 3.9.02 (Ex PW1/9) the plaintiff had informed the defendant " if you feel that no further job is available for the machine, we would then like to withdraw the machine, so that this can be utilized elsewhere at one of our sites and thus, we can save at least our fixed 77 expenses".
23 Apparently, the dispute between the parties had not reached alarming proportion in September,2002. Stand of the plaintiff by that time was that it wanted to withdraw the machinery to be utilized elsewhere. It appears that subsequently, when the relations between the parties worsened, the plaintiff in place of withdrawing the machinery asked for return of the same.
24 There is nothing on record to show that the machinery in question was under
control or power of the defendant. No evidence 78 has been led on record on behalf of the plaintiff to the effect that it could not have removed the machinery from the site without consent or prior permission of the defendant. Although it was argued on behalf of the plaintiff that the machinery could be transported back to Delhi only on execution of necessary documents in this regard by the defendant, but, except for making the submissions, nothing else could be brought on record by the plaintiff in this regard. Admittedly, no police complaint had been lodged by the concerned officer of the plaintiff in October,2004 in the local police station regarding the machinery being found missing from the spot. Letter in this regard 79 was sent by plaintiff to the defendant after about a week and not immediately on coming to know about the missing machines and present suit was filed about 5 months of knowledge of machines being missing from site. This conduct of Officers/representatives of the plaintiff speaks volume in itself. It may be mentioned once again, at the cost of repetition, that it has never been the case of the plaintiff that the machinery at the spot was under
control or guard of the defendant. Admittedly, it was the plaintiff' s technical staff and labour who were posted there, who worked on the machinery and for all intent and purposes, it can be said that the machinery was under their 80 control.
25 In view of all the aforesaid and in absence of any specific evidence regarding delivery of machinery by the plaintiff to the defendant or the machinery being under custody and power of the defendant, this court is of considered opinion that although the machineries, generators etc had been installed at the site, it cannot be said that the same had been delivered by plaintiff to the defendant or that the defendant is still in possession of the same. The plaintiff in opinion of this court had failed to discharge the onus in this regard.
Issue No.2 accordingly, is decided 81 against the plaintiff.
ISSUE NO:3 Whether the plaintiff is entitled to the amount claimed,if yes, at what rate of interest? OPP.
26 It had been mentioned in the plaint by the plaintiff that the defendant was liable to pay to plaintiff a sum of Rs.24,72,307/ but plaintiff was giving up its claim for amount of Rs.4,82,307/ and had filed the present suit for recovery of Rs.19,90,000/ only. Plaintiff had also claimed pendente lite & future interest @ 12 % p. a. on the said amount. As was 82 mentioned in the plaint, stated by PW1 and argued by learned counsel for plaintiff, plaintiff was claiming a sum of Rs.4,41,695/ towards the cost of cement delivered to the defendant and the loss suffered by plaintiff after disposing off the remaining cement; a sum of Rs.15,00,720/ towards depreciation, interest on investment regarding the machinery as well as costs of the machinery; sum of Rs.4,77,504/ towards salary paid to the staff and interest thereupon and further sum of Rs3,25,722/ on account of interest on delayed payments. Plaintiff had also given adjustment and deducted sum of Rs.2,73,334/ as had been claimed by the defendant in its letter dated 83 10.7.04 which was subsequently proved as Ex PW1/35.
27 During course of his arguments it had been submitted by learned counsel for plaintiff that claim of the plaintiff was on three counts i.e for cement, machinery and labour. While deciding issue no.2 hereinabove, this court has already expressed its opinion as regards machinery. In considered opinion of this court the machinery had never been handed over by the plaintiff to the defendant and although the machinery was installed at the site, the defendant never came into custody or possession of the same. In opinion of this 84 court, the machinery cannot be said to be still in possession of the defendant and as such,the plaintiff is not entitled to any amount from the defendant in lieu of the said machinery. 28 As regards the cost of cement and the alleged loss incurred by the plaintiff in disposing of the unaccepted bags of cement, the communications between the parties have to be looked into and have in fact been looked into in detail by this court.
29 It was always case of the plaintiff that parties had agreed for "Shree Cement" 85
and that it was this brand of cement which was supplied to the defendant. It had been claimed that the defendant had broken the contract by refusing to accept delivery of cement of Shree brand which had been agreed to between the parties.
30 During course of his cross examination, PW.1 had specifically admitted that name of the brand of cement was never conveyed in writing but was only conveyed orally. The documents placed on record by the parties do not clear the ambiguity in this regard to any extent whatsoever.
86 31 DW1 during course of his cross examination had admitted that the plaintiff could have supply the cement of any of the five manufacturers which included Vikram cement as well as Shree Cement .
32 The controversy regarding the brand of cement is not cleared by any of the communications between the parties in this regard. This court has gone into in detail documents Ex PW1/3,PW1/3A, PW1/4, PW1/5 , PW1/7, PW1/8 and PW1/9 in this regard. 33 Ex PW1/3 was communication from plaintiff to the defendant. This communication 87 dated 14.11.2000 mentioned Shree brand but the defendant had claimed that it had never received this communication. Delivery of the same could not otherwise be proved on record by the plaintiff. Document Ex PW3/A dated 28.6.2001 written by plaintiff to the defendant mentions the cost and other charges in respect of the bags of cement but does not refer to the brand of cement. Same is the position with letter dated 3.7.2001(ExPW1/4) written by defendant to the plaintiff. Letter dated 13.7.2001 ( Ex PW1/5) sent by plaintiff to the defendant regarding dispatch of cement to Tanakpur also does not mention the brand of cement.
88 34 This now brings us to the three important documents i.e Ext PW1/7,PW1/8 & PW1/9. It appears that document Ex PW1/7 had been written on behalf of plaintiff to the defendant on 2.8.2001 i.e after the defendant had refused to accept delivery of the particular brand of cement claiming that it was not the brand ordered. In this letter the plaintiff had only mentioned about locating customer for purchase of cement lying at Tanakpur and other places. It also requested the defendant to accept delivery of 480 bags of cement lying at Dharchula, but significantly there is not a word in this letter regarding the defendant 89 having been supplied that brand of cement which it had ordered, or regarding the defendant being unjustified in refusing to take delivery of the cement. The other letter i.e Ext.PW1/8 written by plaintiff to defendant is dated 18.9.2001 Even this letter does not mention high handedness of the defendant in refusing to accept delivery of cement on ground of it being not as per order placed . Rather, by virtue of this letter dated 18.9.2001 the plaintiff had only mentioned about delivery of 410 bags of cement to the defendant and requested that the balance amount of Rs.7,79,324/ be debited to its account. The tenor of this letter makes it amply clear that 90 the plaintiff had not raised any objection to the defendant having refused to accept delivery of the cement. Rather, this letter gives an impression that the plaintiff had accepted that the defendant was justified in refusing to take delivery of the cement and that the plaintiff was prepared to bear the burden of loss to be incurred by the plaintiff in this regard. 35 Significantly, the tenor of plaintiff changes in its letter dated 3.9.2002 ( Ex PW1/9).It is only in this letter that the plaintiff had admitted having supplied Shree brand as per order of the defendant. Even in this letter, the plaintiff had appealed to the defendant to 91 pay certain compensation against supply of cement which was a great loss to the plaintiff. It was mentioned that the plaintiff left it to the defendant to accommodate the loss at its convenience . That being the position, letter Ex PW1/9 raises the issue regarding loss incurred by plaintiff in respect of cement, for the first time but, in a guarded manner. The plaintiff had requested the defendant to compensate it for the losses, but had never asserted its right to recovery the losses from the defendant. 36 Letter Ex Pw1/9 was replied by the defendant vide its reply dated 15.9.2002 (Ex PW1/32) wherein it was specifically mentioned 92 that order placed was for Vikram Cement. In its reply dated 17.9.02 ( Ex PW1/12) the plaintiff had mentioned that while issuing order, it was not specifically mentioned about the brand name of cement and that the brand name came up only when Shree brand Cement was supplied. The plaintiff once again appealed for financial relief from the defendant. 37 So, on perusal of the aforesaid communications between the parties, it is apparent that till on 18.9.2001 the plaintiff had never brought up the issue of brand of cement and rather had accepted to bear the losses, but had only requested for some adjustment for the 93 balance amount to be debited to its account. Till 18.9.2001 the plaintiff rather than asking the defendant to pay to it the losses incurred, had agreed to bear the losses and had admitted the balance amount to be debited to its account. Thereafter, the plaintiff had remained quiet for nearly one year and had raked up the issue on 3.9.2002 vide its letter Ex PW1/9. 38 Besides the aforesaid, it is pertinent to note that Vide its letter dated 18.8.2001(Ex PW1/8) plaintiff had mentioned that 410 bags had been delivered at site of the defendant. During course of proceedings, it had been put forth on behalf of plaintiff that 94 besides the said 410 bags, delivery of 700 bags had also been made to the defendant in July,2001 vide Ex PW1/6. It does not appeal to mind of this court that delivery of 700 bags of cement to defendant in July, 2001 was not in knowledge of the plaintiff till 18.9.2001. During course of arguments, it had been submitted on behalf of plaintiff that the said 700 bags had been sent to defendant and taken delivery of by the defendant without knowledge of the plaintiff. This in opinion of this court, is a bit too much to be believed. The story putforward in this regard by PW1 was that 700 bags were taken delivery of by Chowkidar of the defendant without giving any 95 acknowledgment to the plaintiff, nor its delivery was known to the plaintiff at that time. The defendant on the other hand, had specifically claimed that it had never received those 700 bags of cement. Defendant only admitted having received 410 bags of cement and as per claim of the defendant, as the said bags were not of the brand ordered by the defendant, the defendant had debited account of the plaintiff even in respect of those 410 bags.
39 As regards the 700 bags of cement, reliance had been placed by plaintiff upon Ex PW1/6 i.e copy of Excise Challan. A perusal of 96 this document reveals that as per the same, the goods were for delivery at Tanakpur. It does not mention clearly name of receiver, but only mentions Kishore as being driver of the vehicle. It was admitted case of the plaintiff that the manufacturer was to supply cement bags till Tanakpur and thereafter, the same were to be transported from Tanakpur to the site by plaintiff and that plaintiffs were charging the defendant for the same.
If that was so, delivery of 700 bags as mentioned in Ex PW1/6 could not have been taken by defendant at Tanakpur as the plaintiff wants this court to believe. Moreover, 97 during course of crossexamination of DW1, he had stated that he did not recollect name of Security Guard at Dharchula and could not say if one Kishore was posted as Security Guard there. Now, as per Ex PW1/6, Kishore was only driver of the vehicle and not Security Guard of the defendant.
Vide Ex PW.1/5, 700 bags of cement had reportedly been dispatched to Tanakpur vide Truck No. HR38D 3735 and it was stated by plaintiff in said letter that defendant shall be kept informed as and when it shall reach Tanakpur. Ex PW1/6 is also in respect of same Truck No. HR38D 3735 for delivery of bags of 98 cement at Tanakpur. Admittedly, no communication in that regard had been sent by plaintiff to defendant ever and only subsequently, story was built up that delivery thereof was taken by defendant without knowledge of plaintiff. This is hard to believe. 40 During course of his arguments, learned counsel for plaintiff had referred to in detail to crossexamination of DW1 regarding 700 bags of cement. Learned counsel submitted that DW1 had admitted the defendant having received delivery of those 700 bags of cement.
On perusal of testimony of DW1, this 99 court thinks otherwise. There is no explicit admission by DW1 qua defendant having infact received the 700 bags of cement.
41 As regards claim of the plaintiff in respect of loss incurred by the plaintiff in selling the unaccepted bags of cement, in considered opinion of this court the plaintiff has failed to prove on record the losses incurred by the plaintiff in this regard. The alleged sale transactions in this regard could not be proved on record. Despite an objection having been raised on behalf of defendant, plaintiff failed to examine any of the alleged purchasers of the said extra cement. PW.1 100 during course of his crossexamination had admitted that he had not put up any advertisement for auction/sale of the cement bags which were not accepted by the defendant nor had it invited any tender in this regard. Although suggestion was given to PW.1 that the customers mentioned in the invoices Ex PW1/11 were fictitious and imaginary, the plaintiff failed to examine any of them in support of its claim regarding having sold the cement at a loss. All this coupled with letter Ex PW1/8 goes to show that the plaintiff has failed to show that it is entitled to recover any amount from the defendant as regards the alleged loss incurred by the plaintiff in selling 101 of the unaccepted bags of cement in open market. Hence, in considered opinion of this court the plaintiff is not entitled to any amount from the defendant in this regard. 42 As regards claim of the plaintiff regarding the labour and machinery lying idle at the site, it would be pertinent to mention that there is nothing on record to show that the machinery and the labour had been deployed at the site by the plaintiff on asking of or on request of the defendant. It is not case of the plaintiffs that they had engaged fresh labour or technical staff for the specific order placed by the defendant.
102 43 In order to prove payment to some of its staff, plaintiff has placed reliance on Ex PW1/38(102 vouchers). It was claimed by PW.1 in his affidavit Ex PW1/A that the said sum of Rs. 4,42,000/ had been paid for the cause of the defendant and that defendant was liable to pay the same. During course of cross examination of PW1 specific suggestion had been made to him on behalf of the defendant that vouchers Ex PW1/38 were false and fabricated . The witness had admitted that there was nothing in the terms and conditions contained in Ex PW1/15 to PW1/17 entitling the plaintiff to claim the salary given to its 103 employees, from the defendant. Witness admitted that he had not produced any salary register or the attendance register regarding distribution of salary at the site. It would be pertinent to point out that none of the signatories of the said vouchers ( Ex PW1/38) had been examined by the plaintiff in support of its claim. The receipts of the vouchers could have been proved by the plaintiff only by way of producing recipients who ought to have admitted the factum of receipt of salary and identified their signatures on the receipts. In absence thereof, in considered opinion of this court, no reliance can be placed on the vouchers Ex PW1/38. Moreover, as per 104 admitted case of the plaintiff it was only in September,2003 that the contract for manufacturing and supplying steel ribs was broken by the defendant. As already mentioned herein above, there is nothing on record to show that the defendant had placed an order or assured an order for supply of any minimum quantity of steel ribs or rock bolts. In absence of any minimum guaranteed order by the defendant, the plaintiff, in opinion of this court cannot claim that the orders actually placed by the defendant were short of the assured orders or that the machinery or labour deployed at the site had remained idle due to shortage of order on part of the defendant.
105 44 Letter dated 3.9.2002 ( Ex PW1/9) and dated 17.9.02 ( Ex PW1/12) from plaintiff to defendant need to be referred to in this regard. It is apparent from Ex PW1/9 that the rib welding machine had been provided by plaintiff at the site with the hope that sufficient fabrication work was to be awarded for proper utilization of the machine. As per letter Ex PW1/12 the plaintiff had requested the defendant that to make up for the losses, the defendant should give the plaintiff some more substantial job. None of these communications by plaintiff to the defendant mentioned about the defendant having 106 assured any minimum quantity of order or the defendant not complying with the minimum order guaranteed.
45 All this goes to show, that the defendant cannot be said to be liable to make good expenses of the plaintiff in this regard. Even the perusal of the plaint goes to show that as per admitted case of the plaintiff, the plaintiff was assured that orders for steel ribs could be for more than 1110 MT. This is mentioned in para no.30 of the plaint. No claim was made by the plaintiff to the effect that the defendant had ever given order or assurance of order of 1100 MT in writing to the 107 plaintiff. It was admitted in para 37 of the plaint that as the parties were not in disagreement on the required quantity of steel ribs etc., this was never a matter of controversy and as such, never found mention in the exchange of letters between the parties. That being the position, admittedly no written order was placed by the defendant for a minimum of 1100 MT of steel ribs .
46 At the cost of repetition, once again we revert back to Para No.86 of the plaint wherein the plaintiff has mentioned the various heads under which it was claiming the suit amount from the defendant. This shows 108 amount towards supply of and loss for sale of cement,cost of machinery with interest on the said investment and depreciation, interest on the depreciation amount and payment for the salary and interest thereupon. As already observed hereinabove by this court, the plaintiff is not entitled to claim any salaries or interest thereupon from the defendant nor is entitled to claim any payment towards cost of machinery, depreciation or interest thereupon. Plaintiff is also not entitled to any amount towards loss for sale of cement.
47 As regards supply of cement,as has already been observed hereinabove, plaintiff 109 has only proved supply of 410 bags of cement to the defendant. The said quantity is admitted by the defendant also. Plaintiff has failed to prove delivery of 700 bags of cement as had been claimed by the plaintiff.
48 As such, in considered opinion of this court, plaintiff is only entitled to cost and expenses in respect of 410 bags of cement, which amount has been debited by the defendant in account of the plaintiff. Plaintiff is also entitled to interest on the said amount @ 12% per annum . Issue stands decided accordingly.
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ISSUE NO:4 Relief.
49 This court has already opined that plaintiff is only entitled to cost and expenses in respect of 410 bags of cement (i.e Rs.74,620/). The said amount had been debited by defendant in account of plaintiff on 31.3.2002. As plaintiff had already received the transportation charges by cheque from defendant and cost of cement had been paid by defendant to the supplier, in opinion of this court, plaintiff is entitled to interest on said amount only w.e.f. 31.3.2002.
111
Accordingly, suit of plaintiff is decreed for sum of Rs.74,620/ alongwith interest @12% per annum w.e.f 31.3.2002 till realization of decretal amount from the defendant. Plaintiff shall also be entitled to proportionate cost of the suit.
Claim of plaintiff qua remaining amount stands dismissed.
Decree sheet be prepared accordingly. Announced in open court (M. R. Sethi) on 28.7.2008 Addl. District Judge Delhi 112 113