Bright Star Hotels Pvt. Ltd. vs Gobind Singh
2008 Latest Caselaw 1847 Del

*                 IN THE HIGH COURT OF DELHI

                      Judgment reserved on : September 30, 2008
%                       Judgment delivered on : October 20, 2008

+                      RFA 476/2007

BRIGHT STAR HOTELS PVT. LTD.                 ..... Appellant

                  Through:   Mr.Ashwini Kumar Matta,
                             Sr.Advocate with Mr. Anupam
                             Srivastava, Adv.

            VERSUS

GOBIND SINGH                                 ..... Respondent

                  Through:   Mr.A.K. Gupta, Advocate

CORAM:

Hon'ble Mr.Justice Pradeep Nandrajog
Hon'ble Mr.Justice J.R. Midha

1. Whether reporters of local papers may be allowed
   to see the judgment?

2. To be referred to the Reporter or not?

3. Whether judgment should be reported in Digest?


: PRADEEP NANDRAJOG, J.

1. Gobind Singh, carrying on business under the name

and style of "M/s.The Refrigeration House" filed a suit for

recovery of Rs.19.88,722/- against M/s. Bright Star Hotels (P)

Ltd. (hereinafter referred to as „Bright Star‟) alleging that

under eight work orders, Ex.PW-1/1 to Ex.PW-1/8, he was

awarded the work of supply of equipments, installation and

commissioning a central air conditioning unit for the banquet

hall, health club and dining space at Bristol Hotel, Gurgaon,

Haryana being constructed by Bright Star. He alleged having

completed the works and that as per the running account

maintained by him a sum of Rs.13,45,549.50 was due and

payable. He alleged that he was entitled to interest @ 18%

w.e.f. 1.9.1999 till 26.4.2002. He calculated said interest,

being Rs.6,43,172.52. Thus, the total suit amount was

Rs.13,45,549.50 + Rs. 6,43,172.52 = Rs.19,88,722.02. Bright

Star took the defence that Gobind Singh left the work

incomplete and unfinished; he supplied sub-standard material;

the executed work was sub-standard and defective. It was

stated that Bright Star had to engage the services of M/s.

Roots Cooling System Pvt. Ltd. as also M/s.Carrier Aircon Ltd.

to complete the balance work and that the former company

had been paid Rs.7,15,981/- and the latter Rs.64,000/- to

complete the work. Jurisdiction of the Court at Delhi was

challenged on the plea that the goods were delivered at

Gurgaon and the work was executed at Gurgaon.

2. Gobind Singh succeeded after the trial. Vide

impugned judgment and decree dated 25.4.2007 finding

returned is that Bright Star was liable to pay Rs.13,45,549.50

as the amount remaining unpaid for the work executed by

Gobind Singh. Holding that there was no agreement between

the parties regarding interest being payable @ 18% per

annum, interest @ 12% per annum has been awarded w.e.f.

1.9.1999 till realization.

3. The reasoning of the learned Trial Judge is centered

around the proof of the running bills raised by Gobind Singh

being Ex.PW-1/9 to Ex.PW-1/47 and Ex.PW-1/56; which bills

were duly reflected in the statement of account maintained by

Gobind Singh being Ex.PW-1/48. The same evidenced that

Rs.13,45,549.50 was the payment outstanding.

4. The defence of Bright Star has been negated for the

reason no evidence was led of having got executed any work

from M/s. Roots Cooling System Pvt. Ltd. and M/s.Carrier

Aircon Ltd. The work order placed on the said two companies,

never saw the light of the day. No proof of any payment made

to said companies by Bright Star was brought on record. The

defence that the material supplied was sub-standard and that

the work executed was sub-standard has been negated for the

reason the sole witness of Bright Star examined at the trial,

DW-1, was the liaison officer of the company and he failed to

establish any sub-standard work executed or sub-standard

material supplied. No evidence was brought on record by

Bright Star that any of the bills raised on it was rejected on

account of sub-standard material supplied or sub-standard

work executed. No document, correspondence or a

communication was proved as per requirement of Section 42

of the Sale of Goods Act, 1930 notifying the rejection of the

goods or the works. Further reasoning of the learned Trial

Judge is that the work orders have been issued on various

dates between 21.2.1996 and 17.12.1996; evidencing

according to the reasoning of the learned Trial Judge, that the

work was progressing smoothly and to the satisfaction of

Bright Star. For if this was not to be so, Bright Star would not

have placed one after the other, eight work orders.

5. Since at the hearing held on 30.9.2008, Shri

Ashwani Kumar Matta, learned Senior Counsel for Bright Star

made no submission on the plea of territorial jurisdiction of

courts at Delhi, we do not note the facts relatable to the

territorial jurisdiction of the courts at Delhi and the findings

returned by learned Trial Judge thereon.

6. It is settled law that when goods are not rejected by

the buyer within a reasonable time the same are deemed to be

appropriated as per the mandate of Section 42 of the Sale of

Goods Act, 1930. It is also settled law that he who alleges a

fact must establish the fact in the affirmative.

7. Bright Star did not dispute having placed the eight

work orders Ex.PW-1/1 to Ex.PW-1/8. Bright Star disputed

receipt of the bills, but did not dispute that the price at which

the bills Ex.PW-1/9 to Ex.PW-1/47 and Ex.PW-1/56 were raised

was as per the price stipulated in the work orders. Thus, if

Gobind Singh discharged the initial onus of proving having

raised the bills as per the contract between the parties the

onus to establish the defence would be on Bright Star.

8. Bright Star did not challenge the entries in the

statement of account Ex.PW-1/48 meaning thereby, accepted

the credit entries in the said statement of account showing

money received by Gobind Singh from Bright Star. It was not a

defence that certain payments made by Bright Star were not

reflected in the statement of account Ex.PW-1/48. No counter

statement of account maintained by Bright Star was proved at

the trial. Gobind Singh stated that he raised the bills. Thus,

Gobind Singh discharged the initial obligation of proving the

bills being raised on Bright Star amount due and payable and

the amount paid from time to time.

9. Indeed, we find no evidence on record that Bright

Star awarded any work to M/s. Roots Cooling System Pvt. Ltd.

and M/s.Carrier Aircon Ltd. To succeed on the defence that

Gobind Singh left the work incomplete it was necessary that

the work order placed on M/s. Roots Cooling System Pvt. Ltd.

and M/s.Carrier Aircon Ltd. were not only proved but even

connected with the work orders Ex.PW-1/1 to Ex.PW-1/8, to

bring home the point that certain works listed in Ex.PW-1/1 to

Ex.PW-1/8 were awarded to the said two companies. Further,

proof of payment made to said companies had to be brought

on record. Indeed, there is none.

10. We note that DW-1, Col. G.B.S.Sehgal (Retd.), the

liaison officer of Bright Star, in his examination-in-chief (which

we note was filed by way of an affidavit) merely reiterated the

vague pleas in the written statement in respect of the alleged

defective, incomplete work and sub-standard material

allegedly supplied. His testimony on said point is in para 9 and

10 of his affidavit Ex. D-1. He stated as under:-

"9. That the defendant had to get the incomplete work completed and had further got rectified the defects because of the plaintiff for which the plaintiff is liable to compensate the defendant company.

10. That the goods supplied by the plaintiff were of sub-standard quality and defective in nature and the plaintiff has deliberately suppressed the relevant facts regarding the quality of the alleged goods with ulterior motives and with an intention to derive undue advantage to himself."

11. No material particular of the alleged defective or

incomplete work has been referred to by the witness of Bright

Star. In what manner were the goods sub-standard has not

been deposed to by the witness. The testimony is nothing but

a blog.

12. The reasoning of the learned Trial Judge that the

work orders were issued over a period of 10 months evidence

that from time to time the work executed was satisfactory, is a

good reason.

13. We may correct the learned Trial Judge on one

factual point. The work orders are not between 21.2.1996

and 17.12.1996. The work orders commenced from 21.2.1996

to 20.5.1996. For nearly one year and three months, at

different point of time, different work orders were issued. This

lends assurance to the fact that since the works executed

under the earlier work orders were found satisfactory and

further work orders were issued by Bright Star to Gobind

Singh.

14. The bill Ex.PW-1/56 shows that it was the first bill

and was raised on 22.2.1996 and thereafter successive bills

were raised from time to time the last being Ex.PW-1/47 raised

on 10.9.1997. Indeed, not a single letter or a correspondence

has been shown to us that Bright Star rejected any bill.

Obviously, the inference is inescapable. Having not rejected

the supply or the execution of the work within a reasonable

time Bright Star is deemed to have appropriated the goods

and accepted the due execution of the work.

15. We note that in his cross-examination Col.G.B.S.

Sehgal (Retd.) admitted that his company was maintaining a

running account. We note that Bright Star did not produce the

said statement of account and therefore we would be justified

in drawing an adverse inference against Bright Star of not

having produced the best evidence available with it with the

conclusion that had the statement of account been produced it

would have gone against Bright Star. It is also important to

note that in his cross-examination, Col.G.B.S.Sehgal (Retd.)

stated that he was not aware about the contents of the written

statement.

16. To summarize, we may conclude by recording that

Bright Star has not been able to show to us in appeal that the

learned Trial Judge has ignored any relevant and material

evidence or circumstance. It has not been shown to us that

the learned Trial Judge has considered any irrelevant evidence

or an irrelevant circumstance. No perversity has been shown

to us in the process of reasoning adopted by the learned Trial

Judge.

17. That apart we have gone through the testimony of

the witnesses, the work orders Ex.PW-1/1 to Ex.PW-1/8, the

bills Ex.PW-1/9 to Ex.PW-1/47 and Ex.PW-1/56 and the

statement of account Ex.PW-1/48. We are satisfied that

Gobind Singh has proved his case. The total value of the eight

work orders is Rs.30,22,285.50. The bills Ex.PW-1/9 to PW-

1/47 and Ex.PW-1/56 are in the sum of Rs.30,06,367.00.

Ex.PW-1/48, the statement of account shows Rs.13,45,549.50

as balance due.

18. On the issue of interest we note that in the bills

raised, Gobind Singh has clearly recorded that he would be

charging interest @ 18% per annum if the amount remained

outstanding. But we need not deal with this issue any further

for the reason Gobind Singh has not filed any cross-objections

and has accepted interest awarded to him @ 12% per annum.

19. We note that in the year 1997 when the works were

completed and payment became outstanding, scheduled

banks were offering interest at said rates on fixed deposits.

19. We find no merit in the appeal. The appeal is

dismissed with costs quantified at Rs.20,000/- against Bright

Star and in favour of Gobind Singh.

PRADEEP NANDRAJOG, J.

J.R. MIDHA, J.

October 20, 2008 rk