THE HIGH COURT OF DELHI AT NEW DELHI
% Judgment Pronounced on: 23.05.2011
+ CS(OS) No. 1942/2010
R K SWAMY BBDO PRIVATE LTD .....Plaintiff
- versus -
M/S ULTRA MOTOR INDIA PVT LTD ....Defendant
Advocates who appeared in this case:
For the Plaintiff: Mr. I.C.Kumar, Adv.
For the Defendant: None.
CORAM:-
HON'BLE MR JUSTICE V.K. JAIN
1. Whether Reporters of local papers may
be allowed to see the judgment? No
2. To be referred to the Reporter or not? No
3. Whether the judgment should be reported No
in Digest?
V.K. JAIN, J. (ORAL)
IA 17783/2010 (O.37 R.5 CPC) This is an application filed by the defendant for leave to contest the suit.
Since no one is present for the defendant at 3.11 PM, the application is dismissed in default.
The application stands disposed of accordingly. CS(OS)No. 1942/2010 Page 1 of 6 CS(OS) 1942/2010
1. This is a suit under Order 37 Rule 2 of the Code of Civil Procedure. The plaintiff company is engaged in the business of rendering services in the area of Media Direction for developing media strategies, media planning and buying media space, execution, operation and release of advertisements on behalf of its clients in Press, TV, Radio, Films etc. The defendant vide its letter dated 02.01.2009 appointed M/s. Media Direction, a unit of the plaintiff company, as its Media Agency on Record for a period of one year and entered into an agreement dated 11.05.2009 specifying the scope of work and services to be provided by the plaintiff company. The defendant issued various orders to the plaintiff for release of their advertisements. The plaintiff company raised bills for a total sum of Rs.70,36,711/- out of which the defendant paid a sum of Rs.48,05,012/-, leaving a balance amount of Rs.22,29,889/-. It is alleged that the media bills have been paid by the plaintiff because had it not made payment, it would have been deprived of the status and privileged of a Accredited Advertising Agency. The defendant also issued a balance confirmation dated 31.05.2010 admitting therein CS(OS)No. 1942/2010 Page 2 of 6 that they are liable to pay a sum of Rs.21,90,543/- to the plaintiff company. The liability has been reduced from Rs.22,29,889/- to Rs.21,90,543/- since the defendant issued TDS certificates worth Rs.39,346/-. The plaintiff has now claimed the aforesaid amount of Rs.21,90,543/- along with interest thereon at the rate of 18% per annum amounting to Rs.5,96,964/-, which the defendant had agreed to pay on the outstanding dues.
2. Since the application filed by the defendant for leave to contest has been dismissed today, the plaintiff has become entitled to judgment forthwith.
3. In view of the provisions contained in Order 37 Rule 1(2)(b) of the Code of Civil Procedure, the plaintiff is entitled to recover a debt or liquidated payment in money, arising on a written contract, along with interest on that amount. The plaintiff has placed on record a copy of the letter dated 02.01.2009, whereby Media Directions were appointed as the Media Agency of the defendant for a period of one year. The plaintiff has also filed an agreement dated 11.05.2009 executed between the parties. Vide this agreement, the defendant appointed Media Directions , a division of the plaintiff-company as its agency on record for CS(OS)No. 1942/2010 Page 3 of 6 the purpose of handling the assigned media and media related work such as development of media strategies, media planning and buying and execution and operations of various advertising campaigns in respect of the all products/services manufactured and sold/rendered by it. The relevant clauses of the agreement, inter alia, provide as under:
"BILLING PROCEDURE AND TIME FOR PAYMENT All the media costs along with the 3% fee pertaining to the MEDIA AGENCY as aforesaid, will be billed by MEDIA AGENCY on CLIENT from time to time. The bills are payable by CLIENT to MEDIA AGENCY strictly according to the schedule indicated below:
Press Advertising Within 30 days from the date of our bill/invoice TV Advertising Within 30 days from the date of our bill/invoice Radio Advertising Within 30 days from the date of our bill/invoice Film/Internet Advertising Within 30 days from the date of our bill/invoice Outdoor Advertising Within 30 days from the date of CS(OS)No. 1942/2010 Page 4 of 6 our bill/invoice or subject to terms of contract with concessionaires xxxx....In case of a delay in payment to the MEDIA AGENCY from the CLIENT, beyond the stipulated credit period, the outstanding amount will attract interest of 1.5% per month."
The plaintiff has also placed on record the purchase orders, issued to it by the defendant-company from time to time and the invoices raised by it on the plaintiff. The plaintiff-company has also filed the Balance Confirmation Form dated 31st May, 2010, whereby the defendant confirmed that an unpaid balance of Rs 21,90,453/- was due from it to the plaintiff-company as on 31st March, 2010.
4. In view of the averments made in the plaint, coupled with the above-referred documents filed by the plaintiff company, it is entitled to recover a sum of Rs.21,90,543/- from the defendant company as the principal sum. A perusal of the Agreement dated 11.05.2009 would also show that the defendant had agreed to pay an interest at the rate of 18% per annum on the outstanding payment. Hence, the plaintiff is entitled to recover a sum of Rs.21,90,543/-.
CS(OS)No. 1942/2010 Page 5 of 6
For the reasons given in the preceding paragraphs, a decree for recovery of Rs.27,87,507/- with costs and pendente lite and future interest at the rate of 12% per annum is hereby passed in favour of the plaintiff and against the defendant.
Decree sheet be drawn accordingly.
(V.K. JAIN) JUDGE MAY 23, 2011 sn/bg CS(OS)No. 1942/2010 Page 6 of 6