Ulka Advertising Pvt. Ltd. vs Spring Valley Fruit Products Co. ...
1999 Latest Caselaw 888 Del

ORDER

Vikramajit Sen, J.

1. This is suit for recovery of Rs. 12,59,426/- and, as disclosed in the plaint, is predicated on a written contract between the parties whereby the plaintiff was appointed by the Defendant as its Advertising Agent. The Plaintiff was entitled to claim 15 per cent as its Agency Commission on the gross amount of bills in connection with its publicity campaign. Various bills were raised between May 1988 and June parties and as on 10.5.1989 a sum of Rs. 6,83,160.81 was outstanding in favour of the plaintiff and against the Defendant. This, together with interest thereon, being Rs. 5,76,266/- constitutes the claim in the suit. It is further stated in the plaint that the Defendant vide its letter dated 7.12.1989, acknowledged the outstanding amount of Rs. 6,83,160.81 and undertook to clear it; a similar assurance was contained in the another letter dated 7.12.1989 of the Defendant to the Plaintiff. When payment was not received the Plaintiff caused a legal notice dated 13.8.1990 to issue to the Defendant. Since some cheques, earlier made over to the Plaintiff by the Defendant, were dishonored a second legal notice dated 30.8.1990 was issued, inter alia, claiming interest at the rate of 22 per cent per annum.

2. Consequent upon summons being served on the Defendant a Written Statement was filed on its behalf. On 2.12.1997 costs of Rs. 10,000/- was imposed and it was observed that in case the Defendant does not appear before the Joint Registrar to admit/deny the documents on the next date of hearing, his defense shall stand struck off automatically. Costs were not paid and admission/denial was also not carried out. On 14.1.1999 the Court observed that the Defendant's defense stands struck off and that in these circumstances the Plaintiff should file affidavit by way of evidence. This has been done.

3. Mr. Shmimud din, Manager (Accounts, and legal Affairs) of the Plaintiff has filed his affidavit in which he has stated, inter alia, that the Agreement between the parties, Exh. PW-1/2, was executed at New Delhi and that the Company performed and discharged all its obligations under the Agreement Exh. PW-1/2 and for the jobs done, bills were correctly raised. He has deposed that Exh. PW-1/3 was a true copy of the Statement of Accounts maintained by the Company in the normal course of business. This Statement shows that the said sum of Rs. 6,83,568.31 is outstanding against the Defendants. In Ex. PW-1/6 interest on this sum at the rate of 22 per cent has been calculated and a sum of Rs. 5,76,266/- is shown as payable on this account.

4. In the Written Statement, the territorial jurisdiction of this Court had been objected to. Although the defense of the Defendant was struck off the Court is required to satisfy itself that it has territorial jurisdiction in the matter. The Ex. PW-1/2 appears to have been signed at Delhi as it is engrossed on stamp paper purchased in Delhi. Furthermore, as set out in the plaint, the contents of which must be treated as uncontroverted, payments were required to be made and were in fact made by the Defendant to the Plaintiff at Delhi. Since the Defendant also had its Branch Office in Delhi, as is evident from the advertisement, inter alia, as appearing in Ex. PW1/30 carried in the newspapers, these statements can be assumed to be correct. Accordingly I hold this Court has jurisdiction to adjudicate and decide the suit.

5. As mentioned hereinabove the Defendant has admitted its liability in Ex. PW-1/4 and Ex. PW-1/5 in which it has further undertaken to clear the payments with interest. The Agreement. Ex. PW-1/2 itself witnesses that interest will be paid at the rate of 22 per cent per annum on all bills outstanding in excess of 30 days from the date of the bills. Demand for interest on this rate has also been made in the legal notices mentioned above. I hold that the Defendant is liable to payment of interest at the rate of twenty two per cent.

6. I, therefore, hold that the Plaintiff has proved that a sum of Rs. 6,83,568.31 is due and payable to it by the Defendant on account of the payment made and expenses incurred by the Plaintiff in the publicity campaign carried out by it on the instructions of the Defendant. I further hold that it was contracted between the parties that interest would be due and payable at the rate of 22 per cent per annum on this outstanding and that the claim made in the Plaint is correct. Accordingly the suit is decreed, as prayed, for a sum of Rs.12,59,426/- together with further interest thereon at the rate of 22 per cent per annum from the filing of the suit till the recovery of the decretal amount.

7. Decree sheet be prepared accordingly.