Delhi District Court
Through Its Authorized Signatory/Poa ... vs M/S M.N.S. Builders on 6 April, 2023
IN THE COURT OF SH. RAKESH SYAL,
DISTRICT JUDGE (COMMERCIAL COURT)-03,
SOUTH-WEST DISTRICT, DWARKA COURTS, NEW DELHI.
CS (COMM) 17/2022
M/s Reach International
(A registered partnership firm)
Principal Place of Business:
Plot No. 21, Palam Matiala Road,
Madhu Vihar, Opp. Sector-5,
Dwarka, New Delhi-110059.
Corporate Office:
Office No. 702, 7th Floor,
New Delhi House, 27, Barakhamba Road,
New Delhi-110001.
Email: [email protected]
Mobile No.: +91-9711396059
Through its Authorized Signatory/POA Holder of Partners
-Mr. Rahul Varshney (Operational Manager)
.... Plaintiff
VERSUS
1. M/s M.N.S. Builders
(A partnership firm)
CS(COMM) 17/2022 M/s Reach International vs M/s M.N.S. Builders & Anr. Page no. 1 of 18
Principal Place of Business:
1st Floor, Shadilal Dharamshala, Railway Road,
Etawah, Uttar Pradesh-206001.
Also at:
C/o Saxena's Ist Floor,
Swaroop Nagar, Railway Road,
Etawah, U.P.- 200601.
Email: [email protected]/[email protected]
Mobile No.: +91-8805507900/+91-8805507900
2. Mohit Saxena (Partner)
Address:
C/o Saxena's, 1st Floor,
Swaroop Nagar, Railway Road,
Etawah, Uttar Pradesh-206001.
Email: [email protected]/[email protected]
Mobile No.: +91-8805507900/+91-8805507900
.... Defendants
ORDER
1.1 This order shall decide application dated 06.12.2022, under Order XIII A of the CPC, 1908, as amended by the Commercial Courts Act, 2015 (hereinafter referred to as the Act), for summary judgment against the defendant, filed by the plaintiff.
CS(COMM) 17/2022 M/s Reach International vs M/s M.N.S. Builders & Anr. Page no. 2 of 18 2.1 The facts relevant for the disposal of the above application are that the plaintiff has filed the suit for recovery of Rs. 3,44,075/- (Rupees three lac forty four thousand and seventy five only), alongwith future and pendente-lite interest @18.00%, per annum, against the defendants.
2.2 The plaintiff's case is that the plaintiff is a well known, reputed and registered partnership firm engaged in the business of leasing of industrial machines and aerial work platforms, such as boom lifts, scissor lifts, spider lifts etc., for hire. The plaintiff firm was constituted vide Partnership Deed dated 18.08.2009 and was registered with the Registrar of Firms, Dwarka, Delhi vide Certificate dated 30.09.2019, as Firm no. 11/2019. The suit has been filed through Sh. Rahul Varshney, duly authorized vide Power of Attorney dated 01.12.2020. It is also stated that defendant no. 1 is a partnership firm offering construction services for buildings, complexes and warehouses etc. Defendant no. 2 is one of the partners in defendant no. 1 firm and is also in-charge of the day to day activities of the firm. Defendant no. 1 is a GST registered dealer having GST Identification Number 09ABDFM3241P2ZW.
2.3 It is further stated that in and around September, 2016, the defendant approached the plaintiff and expressed interest in hiring industrial machines to facilitate its construction activities. The defendant required prompt delivery of the Industrial Machine Model Nos. 460SJ- 68844, 450AJ-673 and 600AJ, at two sites, namely Rohtak (in the State CS(COMM) 17/2022 M/s Reach International vs M/s M.N.S. Builders & Anr. Page no. 3 of 18 of Bihar) and in Sanand (in the State of Gujarat). Based on the positive representation of the defendant, the plaintiff agreed to lease its industrial machines to the defendant. Accordingly, the plaintiff leased the industrial machines at both the aforementioned sites and transported the same to the desired locations, i.e. Rohtak and Sanand, for a consideration of monthly rent which depended on the number of hours for which the said machines were operated, excluding other charges and receivables. Monthly invoices were issued by the plaintiff for respective sites from 01.11.2016, on the basis of usage and hours of operation of the said machines, which were duly documented in the form of 'Log Sheets' at the aforesaid sites. It was further agreed that any additional usage of the industrial machines shall be paid on a pro-rata basis.
2.4 It is further stated that the aforesaid relationship was extended on a monthly basis on the request of the defendant and the plaintiff continued to supply its industrial equipment at the sites of the defendant. The plaintiff endeavored to maintain log books, wherein the time for which the machinery was in operation was noted on a day to day basis and a monthly report mentioning the details of number of working hours of machinery, and whether it was operated into overtime hours, was also supplied to the defendant. The same was checked and verified by the defendant's personnel present at the construction site itself.
2.5 It is also stated that the plaintiff regularly raised invoices at the end of each month for which the machinery was used. The same CS(COMM) 17/2022 M/s Reach International vs M/s M.N.S. Builders & Anr. Page no. 4 of 18 were payable within 30 days from the date of the invoice. The defendant made promises of making timely payments to the plaintiff. The details of such invoices is as under:-
S. No. Date of Invoice Billing Period Invoice No. Amount (in Rupees) 1 01.11.2016 October, 2016 AA/2016-17/475 36,639/- 2 01.11.2016 October, 2016 AA/2016-17/476 68,083/- 3 01.12.2016 November, AA/2016-17/530 78,200/- 2016 4 01.12.2016 November, AA/2016-17/531 71,364/- 2016 5 02.01.2017 December, 2016 AA/2016-17/585 68,630/- 6 02.01.2017 December, 2016 AA/2016-17/586 84,215/- 7 01.02.2017 January, 2017 AA/2016-17/661 78,200/- 8 01.02.2017 January, 2017 AA/2016-17/662 77,379/- 9 01.03.2017 February, 2017 AA/2016-17/722 78,200/- 10 01.03.2017 February, 2017 AA/2016-17/723 65,622/- 11 01.04.2017 March, 2017 AA/2017-18/032 27,031/- 12 01.04.2017 March, 2017 AA/2017-18/034 1,00,626/- 13 01.05.2017 April, 2017 AA/2017-18/123 1,04,385/- 14 06.06.2017 May, 2017 AA/2017-18/193 57,500/-
Total Amount 9,96,074/-
CS(COMM) 17/2022 M/s Reach International vs M/s M.N.S. Builders & Anr. Page no. 5 of 18
2.6 It is further stated that according to books of accounts and
ledger entries maintained by the plaintiff, after incorporating the payments made by the defendant, the total outstanding liability of the defendant is Rs. 3,44,075/- (Rupees three lac forty four thousand and seventy five only). The detailed ledger entries, along with particulars of the industrial equipment leased, are as under:-
Date Billing Bill Model Amount (in Payment TDS Balance period No. Rupees) Received (in (in Rupees) Rupees 30.09.2016 Adv NEFT - - 1,00,000/- - 1,00,000/-
01.11.2016 October, 475 460SJ- 36,639/- - - 63,361/-
2016 68844 01.11.2016 October, 476 450AJ- 68,083/- 4,722/- 2016 673 01.12.2016 November, 530 460SJ- 78,200/- 82,922/- 2016 68844 01.12.2016 November, 531 450AJ- 71,364/- 1,54,286/- 2016 673 02.01.2017 December, 585 460SJ- 68,630/- 2,22,916/- 2016 6844 02.01.2017 December, 586 450AJ- 84,215/- 3,07,131/- 2016 673 10.01.2017 Pay NEFT 1,00,000 2,07,131/- 17.01.2017 Pay NEFT 2,00,000 7,131/- CS(COMM) 17/2022 M/s Reach International vs M/s M.N.S. Builders & Anr. Page no. 6 of 18 01.02.2017 January, 661 460SJ- 78,200/- 85,331/- 2017 6844 01.02.2017 January, 662 450AJ- 77,379/- 1,62,710/- 2017 673 01.03.2017 February, 722 460SJ- 78,200/- 2,40,910/- 2017 6844 01.03.2017 February, 723 450AJ- 65,622/- 3,06,532/- 2017 673 28.03.2017 Pay NEFT 1,50,000/- 1,56,532/- 01.04.2017 March, 032 460SJ- 27,031/- 1,83,563/- 2017 6844 01.04.2017 March, 034 600AJ 1,00,626/- 2,84,189/- 2017 28.04.2017 Pay NEFT 1,00,000/- 1,84,189/- 01.05.2017 April, 123 600AJ 1,04,385/- 2,000/- 2,86,574/- 2017 06.06.2017 May, 2017 193 600AJ 57,500/- 3,44,075/- Total 9,96,074/- 6,50,000/- 2,000/- 3,44,075/- 2.7 It is also stated that the defendant failed to adhere to the
promised timeline for payment and started avoiding calls and meeting the representatives of the plaintiff for payment of the aforesaid dues. Upon the persistent efforts of the plaintiff to establish contact with the defendant, the plaintiff was always promised with new and extended deadlines before the expiry of which the defendant would again assure CS(COMM) 17/2022 M/s Reach International vs M/s M.N.S. Builders & Anr. Page no. 7 of 18 full and final settlement of outstanding dues. However, the same was repeatedly dishonored by the defendant by citing excuses for non-
payment. As a result, the plaintiff decided to recall their business relationship with the defendant till the outstanding dues were paid in full. The defendant, without sufficient reason and in violation of the payment terms as agreed between the parties, is intentionally withholding the dues of the plaintiff in order to cause wrongful loss to the plaintiff and wrongful gains for itself.
2.8 It is further stated that even after the tireless attempts of the plaintiff to contact the defendant and seek update on the status of the payment of aforesaid outstanding dues, through e-mails as well as telephonic conversations, there was no response from the defendant. The representatives of the plaintiff even made personal visits to the office of the defendant to secure a definitive date or a projected timeline within which all outstanding dues would be settled. However, the defendant paid no heed to the repeated requests made by the plaintiff and refused to release the outstanding dues. The defendant has never raised any dispute or concern regarding the aforesaid services and charges offered by the plaintiff. Consequently, the plaintiff, through its Advocates, issued a Legal Demand Notice dated 09.04.2019, to the defendant, through Indian Post Service dated 11.04.2019. However, the defendant failed to reply to the aforesaid Demand Notice.
CS(COMM) 17/2022 M/s Reach International vs M/s M.N.S. Builders & Anr. Page no. 8 of 18 2.9 It is also stated that the defendants deliberately did not make payments to the plaintiff so as to cheat the plaintiff. Thus, the plaintiff is seeking interest at the rate of 18.00%, per annum, for a period of fifty- three months period prior to the institution of the suit with effect from 06.07.2017 i.e. from 30 days after the date of the last invoice dated 06.06.2017, raised by the plaintiff up-till the month of December, 2021, and for a further period of pendency of the suit till its realization. The plaintiff has prayed for a decree against the defendants for recovery of Rs. 3,44,075/- (Rupees three lac forty four thousand and seventy five only), alongwith pendente lite and future interest @ 18.00%, per annum, and costs of the suit.
3.1 Summons of the suit could not be served upon the defendants in the ordinary way. Thus, vide order dated 29.07.2022 of my Ld. Predecessor, the defendants were directed to be served by publication in the newspapers, "The Statesman" and "Veer Arjun'. Accordingly, the defendants were served vide publication in the newspapers, "The Statesman" and "Veer Arjun", both dated 13.10.2022. However, neither anybody appeared on behalf of the defendants nor written statement was filed. Thus vide order dated 07.12.2022, the defendants were proceeded against ex-parte.
4.1 It is pertinent to mention that on 14.02.2023, the plaintiff has also moved an application u/o XI Rule 1 (5) CPC, as amended by the Act, for bringing on record additional documents, being invoices which CS(COMM) 17/2022 M/s Reach International vs M/s M.N.S. Builders & Anr. Page no. 9 of 18 were, inadvertently, left out by the plaintiff at the time of filing of suit. The said application was allowed vide order dated 14.02.2023.
5.1 In the application u/o XIII A CPC, as amended by the Act, while reiterating the averments made in the plaint, it is stated that the defendant owes to the plaintiff an amount of Rs. 3,44,075/- (Rupees three lac forty four thousand and seventy five only), as unpaid outstanding dues, against hiring charges for Industrial Machine Model Nos. 460SJ- 68844, 450AJ-673 and 600AJ, provided to the defendant at their two sites, namely Rohtak (in the State of Bihar) and Sanand (in the State of Gujarat), to expedite its construction activities. The same can be said to be admitted and acknowledged by the defendant through their efforts of seeking extended dates to make payment. The defendant has failed to clear the outstanding dues, despite various opportunities and service of Legal Notice upon him.
5.2 It is also stated that the plaintiff has filed application for Pre- Institution Mediation, but the defendant failed to appear and, thus, the settlement could not take place. The defendant has neither appeared before this court nor made any effort to defend their case. Thus, it is sufficiently clear that the defendant has no real prospect to successfully defend the claim of Rs. 3,44,075/- (Rupees three lac forty four thousand and seventy five only), including interest @ 18.00% per annum, for a period upto the institution of the present suit and pendente-
CS(COMM) 17/2022 M/s Reach International vs M/s M.N.S. Builders & Anr. Page no. 10 of 18 lite and future interest, raised by the plaintiff. The said claim can be granted straightaway without recording of oral evidence.
6.1 Ms. Neha Anand, Ld. Counsel for the plaintiff has generally argued on the lines of application dated 06.12.2022 and the plaint. Ld. Counsel has submitted that the Statement of Account placed at page no. 42 of the documents filed by the plaintiff is correct. However, in the yearwise ledger account, placed at page nos. 43 and 46, of the documents filed by the plaintiff there has been some wrong accounting and thus, the same may not be considered. She has also relied upon, ITC Limited vs Vikas Rastogi, 2018 SCC OnLine Del 9980, Balraj Taneja and Another vs Sunil Madan and Another, (1998) 8 Supreme Court Cases 396, Su- Kam Power Systems Ltd vs Kunwer Sachdev ad Another, 2019 SCC OnLine Del 10764, Jindal Saw Limited vs Aperam Stainless Services and Solutions Precision Sas and Others, 2019 SCC OnLine Del 9163, Northern ARC Capital Limited vs Sambandh Finserve Private Limited, 2022 SCC OnLine Mad 2904, Warner Bros. Entertainment INC vs HTTPS://YO-Movies.Com and Others, 2022 SCC OnLine Del 2828, and Glaxo Group Limited vs Aar Ess Remedies Private Limited & Ors., 2017 SCC OnLine Del 9549.
7.1 I have heard Ms. Neha Anand, Ld. Counsel for the plaintiff and also perused the record.
CS(COMM) 17/2022 M/s Reach International vs M/s M.N.S. Builders & Anr. Page no. 11 of 18 8.1 It is pertinent to refer to Order XIII A Rules 1 and 3 CPC, as amended by the Act, which stipulates as under:-
"1. Scope of and classes of suits to which this Order applies: (1) This Order sets out the procedure by which Courts may decide a claim pertaining to any Commercial Dispute without recording oral evidence.
(2) For the purposes of this Order, the word "claim" shall include-
(a) part of a claim;
(b) any particular question on which the claim (whether in whole or in part) depends; or
(c) a counterclaim, as the case may be.
(3) ....."
"3. Grounds for summary judgment.--The Court may give a summary judgment against a plaintiff or defendant on a claim if it considers that--
(a) the plaintiff has no real prospect of succeeding on the claim or the defendant has no real prospect of successfully defending the claim, as the case may be; and
(b) there is no other compelling reason why the claim should not be disposed of before recording of oral evidence."
CS(COMM) 17/2022 M/s Reach International vs M/s M.N.S. Builders & Anr. Page no. 12 of 18 8.2 In this case, as argued by the Ld. Counsel for the plaintiff, there is no need to issue notice of the application under Order XIII A to the defendants, since they have already been proceeded against ex-parte. In this regard, reference can be made to Glaxo Group Limited vs Aar Ess Remedies Private Limited and Ors., (Supra), wherein the Hon'ble High Court of Delhi held, "9. By I.A. No. 8434/2017 the plaintiff prays for summary judgment in terms of Order XIII-A Rule 2 read with Section 151 CPC. Though as per Order XIII-A CPC at least 30 days notice to the defendants is required to be issued before fixing the suit for hearing on summary judgment; as noted, the defendants have already been proceeded ex-parte vide order dated 1st February, 2017. Thus summary judgment can be passed on the basis of pleadings accompanied by the statutory affidavits under the Commercial Courts, Commercial Division and Commercial Appellate Division of High Courts Act, 2015 and the documents filed.
8.3 It is pertinent to refer to Su-Kam Power Systems Ltd. vs Kunwar Sachdev and Another, (Supra), wherein the Hon'ble High Court of Delhi has held, "49. Consequently, this Court is of the view that when a summary judgment application allows the Court to find the necessary facts and resolve the dispute, proceeding to trial would generally not be proportionate, timely or cost effective. It bears CS(COMM) 17/2022 M/s Reach International vs M/s M.N.S. Builders & Anr. Page no. 13 of 18 reiteration that the standard for fairness is not whether the procedure is as exhaustive as a trial, but whether it gives the Court the confidence that it can find the necessary facts and apply the relevant legal principles so as to resolve the dispute as held in Robert Hryniak (supra)."
"52. Consequently, this Court is of the opinion that there will be 'no real prospect of successfully defending the claim' when the Court is able to reach a fair and just determination on the merits of the application for summary judgment. This will be the case when the process allows the court to make the necessary finding of fact, apply the law to the facts, and the same is a proportionate, more expeditious and less expensive means to achieve a fair and just result"
8.4 In Warner Bros. Entertainment INC vs HTTPS://YO- Movies.Com and Others, (Supra), the Hon'ble High Court of Delhi has held, "23. Since the Defendant Nos. 1, 14 to 24 are not appearing, despite notice, in my opinion, the suit can be heard and decided summarily. The Defendant Nos. 1, 14 to 24 have no real prospect of successfully defending the claim of copyright infringement and have further not chosen to contest the said claim....."
CS(COMM) 17/2022 M/s Reach International vs M/s M.N.S. Builders & Anr. Page no. 14 of 18 9.1 It can be seen that the plaintiff's case is based on the following 14 invoices, vide which the plaintiff has leased out industrial machines, Model nos. 460SJ-68844, 450AJ-673 and 600AJ, to the defendant at their two sites at Rohtak and Sanand, S. No. Date of Invoice Billing Period Invoice No. Amount (in Rupees) 1 01.11.2016 October, 2016 AA/2016-17/475 36,639/-
2 01.11.2016 October, 2016 AA/2016-17/476 68,083/-
3 01.12.2016 November, AA/2016-17/530 78,200/-
20164 01.12.2016 November, AA/2016-17/531 71,364/-
20165 02.01.2017 December, AA/2016-17/585 68,630/-
20166 02.01.2017 December, AA/2016-17/586 84,215/-
20167 01.02.2017 January, 2017 AA/2016-17/661 78,200/-
8 01.02.2017 January, 2017 AA/2016-17/662 77,379/-
9 01.03.2017 February, 2017 AA/2016-17/722 78,200/-
10 01.03.2017 February, 2017 AA/2016-17/723 65,622/-
11 01.04.2017 March, 2017 AA/2017-18/032 27,031/-
12 01.04.2017 March, 2017 AA/2017-18/034 1,00,626/-
13 01.05.2017 April, 2017 AA/2017-18/123 1,04,385/-
CS(COMM) 17/2022 M/s Reach International vs M/s M.N.S. Builders & Anr. Page no. 15 of 18 14 06.06.2017 May, 2017 AA/2017-18/193 57,500/-
Total 9,96,074/-
9.2 As per the Statement of Account, filed by the plaintiff, the
defendant has made the following payments,
Sno. Date Amount
1 30.09.2016 1,00,000/-
2 10.01.2017 1,00,000/-
3 17.01.2017 2,00,000/-
4 28.03.2017 1,50,000/-
5 28.04.2017 1,00,000/-
Total 6,50,000/-
Further, on 01.05.2017, a sum of Rs. 2,000/- (Rupees two thousand only), has been shown as TDS. Thus, the total amount outstanding against the defendant is Rs. 3,44,074/- (Rupees three lac forty four thousand and seventy five only) [Rs. 9,96,074 minus Rs. 6,50,000/- minus Rs. 2,000/- = Rs. 3,44,074/-] 9.3 As earlier stated, the defendants have neither appeared nor filed any written statement. Thus, the averments made in the plaint are deemed to have been admitted by the defendant. The authorized representative of the plaintiff has also filed affidavit and Statement of CS(COMM) 17/2022 M/s Reach International vs M/s M.N.S. Builders & Anr. Page no. 16 of 18 Truth along with the plaint and declaration on oath with regard to the documents. The total amount outstanding against the defendants is Rs. 3,44,074/- (Rupees three lac forty four thousand and seventy four only). Defendant no.1 is a registered partnership firm and defendant no. 2 is one of its partners. Thus, both the defendants are, jointly and severally, liable to pay the outstanding amount due to the plaintiff. There appears to be no reason on record as to why relief sought by the plaintiff/applicant should not be granted.
10.1 In view of the aforesaid discussion, it is considered that the defendants have no real prospect of successfully defending the claim, and there is also no other compelling reason as to why the plaint should not be disposed off before recording the oral evidence. Accordingly, the application for summary judgment u/o XIII A CPC is allowed.
10.2 The plaintiff has also prayed for pendente-lite and future interest, on the outstanding amount of Rs. 3,44,075/- (Rupees three lac forty four thousand and seventy five only), @ 18.00%, per annum. However, such high rate of interest does not appear to be justified. In the facts and circumstances of the case, it is considered that pendente-lite and future interest @ 6.00%, per annum, would be just and reasonable. Thus, it is held that the plaintiff is entitled to recover from the defendants, jointly and severally, a sum of Rs. 3,44,074/- (Rupees three lac forty four thousand and seventy four only), alongwith pendente-lite CS(COMM) 17/2022 M/s Reach International vs M/s M.N.S. Builders & Anr. Page no. 17 of 18 and future interest @ 6.00%, per annum, till realization of the entire amount.
10.3 Accordingly, the suit is decreed in favour of the plaintiff and against the defendants, jointly and severally, for a sum of Rs. 3,44,074/- (Rupees three lac forty four thousand and seventy four only), alongwith pendente-lite and future interest @ 6.00%, per annum, till realization of the entire amount.
11.1 The plaintiff is also awarded costs of the suit.
12.1 Decree be drawn accordingly.
13.1 A copy of this judgment be issued to all the parties to the dispute through electronic mail, if the particulars of the same have been furnished, or otherwise, in terms of Order XX Rule 1 of the Code of Civil Procedure, 1908 (as amended by the Commercial Courts Act, 2015).
14.1 File be consigned to Record Room.
Announced in open Court on 06.04.2023.
(Rakesh Syal) District Judge (Commercial Court)-03, South-West, Dwarka Courts, New Delhi 06.04.2023 CS(COMM) 17/2022 M/s Reach International vs M/s M.N.S. Builders & Anr. Page no. 18 of 18