M/S. Sanmati Rice (P) Ltd. vs Sushil Raja
2011 Latest Caselaw 1497 Del

*             IN THE HIGH COURT OF DELHI AT NEW DELHI

+                         RFA No.282/2001

%                                                  15th March, 2011

M/S. SANMATI RICE (P) LTD.                        ...... Appellant
                Through:        Ms. Ritu Rastogi, Advocate


                          VERSUS


SUSHIL RAJA                                        ...... Respondent

Through: None.

CORAM:

HON'BLE MR. JUSTICE VALMIKI J.MEHTA

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

2. To be referred to the Reporter or not?

3. Whether the judgment should be reported in the Digest?

VALMIKI J. MEHTA, J (ORAL)

1. The challenge by means of this Regular First Appeal under

Section 96 of the Code of Civil Procedure, 1908 is to the impugned

judgment and decree dated 21st March, 2001 whereby the suit of the

respondent/plaintiff for damages was decreed on the ground that the

appellant allegedly supplied rice which was defective, that is, not as

per the sample agreed to between the parties, and also that the weight

of the bags in which rice was supplied was less than the stated weight.

2. The facts of the case are that the respondent/plaintiff

placed an order upon the appellant/defendant for supply of rice F.O.R.

Kandla, Gujarat. The rice was to be non-basmati par-boiled rice, also

called sela rice. The rice was supplied by the appellant/defendant to

the respondent/plaintiff at Kandla on 27.10.1996 and 29.10.1996. This

rice was then exported by the respondent/plaintiff to Dubai, UAE. The

respondent/plaintiff contended that the buyer complained that the rice

was not of a good quality and also that the quantity of rice in the bags

was insufficient. The respondent/plaintiff, therefore, contended that

the foreign buyer, M/s. Adil Ahmed Food Stuffs rejected the

consignment which resulted in loss to the respondent/plaintiff. The

respondent/plaintiff also claimed charges for his trip to UAE.

3. The appellant/defendant appeared and contested the suit.

It was stated that the suit was a counter blast to the case filed against

the respondent/plaintiff for dishonour of cheques as also another

criminal complaint filed against the respondent/plaintiff. It was denied

that the rice supplied to the respondent/plaintiff was defective. It was

contended that the rice which was supplied was duly checked by the

representative of the respondent/plaintiff, one Sh. Ashok Kumar and

the stand therefore that the rice was defective was denied. It was also

denied that there was deficiency in weight in the rice bags supplied.

4. The Trial Court after the pleadings were complete, framed

the following issues:-

"1. Whether this Court has no jurisdiction to try and entertain the present suit? OPD

2. Whether the suit is bad for lack of cause of action? OPD

3. Whether the suit is bad on the account of concealment of the material facts? OPD

4. Whether the plaintiff is entitled for the recovery of money on the account of damages, if so what sum? OPP

5. Whether the plaintiff is entitled for interest, if so what rate and from which period? OPP

6. RELIEF."

5. The Trial Court while dealing with issue nos. 4 and 5 held

that the appellant/defendant was guilty of supply of defective rice and

therefore granted damages. The trial Court however did not grant the

expenses of the trip of the respondent/plaintiff to UAE. The relevant

findings of the Trial Court in this regard read as under:-

"Issue nos. 4 & 5

Whether the plaintiff is entitled for the recovery of money on the account of damages, if so what sum? OPP &

Whether the plaintiff is entitled for the interest, if so, at what rate and for which period? OPP

Issue no.4 and 5 are co-related to each other so I shall decide both the issues together simultaneously. The onus to prove these two issues are on the plaintiff and ld. counsel for the plaintiff has argued that in consideration of the testimony of

both the witnesses PW1 and DW1 plaintiff is entitled for the recovery of suit amount and he has drawn the attention of the court during the course of argument on para 8,10,11,12, 13 and 14 and exhibited documents from ex.PW1/1 to ex.PW1/4 and stated that plaintiff is entitled to recover the suit amount at the rate of 18% P.A. which is quite reasonable in the business dealing and he relied judgments AIR 1974 Maysur 20 and AIR 1970 Calcutta 142. On the other hand counsel for the defendant has stated that the plaintiff placed order to the defendant nor as broker and he has drawn the attention on the ex.DA and cross examination of PW1 and stated that as per ex.PW1/1 document dt.3/12/96 and he has also drawn the attention of the court on para 8 of the WS and stated that a fax massage was sent to the defendant on 14/11/96 stated that 5000 US dollars will be transfer on 25/11/96 to the bank of defendant. The correspondence itself shows that the quality and quantity of the supply was correct, because if there was any deficiency he should not have sent the fax massage. He also drawn the attention of the prayer clause of the plaint and stated that the plaintiff is not entitled any suit amount when he is not entitled any suit amount no question arises for the interest. In consideration of the submissions made by the counsel I also perused the file and testimony of both the witnesses PW1 and DW1 but the plaintiff has failed to prove the expenses spent by him as Rs.1,05,689/- on account of AIR fair, lodging boarding, tele- communication etc. besides these expenses which the plaintiff claimed in para 9 of the plaint but as per the exhibited documents ex.PW1/1 i.e. letter of Fadal Akel Trading Est. in which it is written that the net weight of each bag 46.84 kg. It is also written that gross weight of each bag 47.84 kg. and plaintiff has proved vide ex.PW1/2 that the goods received by the foreigner buyers was entirely different to the order and it is also written in ex.PW1/2 not only bags are short but weight of each bag was less than 50 kg. so it is admitted case of the party that the order was placed by the plaintiff for exporting 214 metric tons for non basmati cella rice to the defendant for Dubai (UAE) and defendant supplied 1234 bags for 50 kg. for export to Dubai (UAE) and he sent goods vide GR 5677 and 5770 dt. 22/10/96 and goods were reached at Kandla Port on 27/8/96 and on 29/10/96 and thereafter the plaintiff received fax massage which he has

proved ex.PW1/1 and also received a letter which he has proved ex.PW1/2 and even defendant has not produce persons as alleged by DW1 one Ashok Kumar who was the Manager of Sushil Raja to check the quality and quantity of the rice and signed the bill ex.DA at point A while PW1 has denied the same and stated that Ashok kumar is not the Manager of the plaintiff and he is the man of the defendant so defendant has failed to prove that there is one Ashok Kumar who is the Manager of the plaintiff. So the rice were not checked at the time of consignment to Dubai at Kandla Port Airport so plaintiff has suffered a loss of Rs.3,60,000/- due to misconduct of the defendant as defendant without checking the rice supplied the same for exporting to Dubai that was the inferior and unmarkable quality but in the absence of any document which shows that the plaintiff has spent Rs.1,05,639/- on the document of air fair lodging, boarding, tele-communication etc. is the oral testimony of plaintiff is not acceptable. It is very difficult to come to the conclusion that the defendant has spent Rs.1,05,689/- on the air fair lodging, boarding without producing any documentary proof but there is no doubt that the plaintiff has suffered damages by reasons the supply of inferior quality of the rice that was not as per the order so plaintiff is entitled as the damages of Rs.3,60,000/- at the rate of interest 15% P.A. The issue no.4 and 5 are disposed off accordingly."

6. I am afraid that the learned Trial Court has committed a

clear-cut illegality and perversity in holding that the

appellant/defendant supplied defective rice which was not as per the

sample. In a suit filed for goods not supplied as per sample, it is

elementary that the sample by which the sale takes place must be

relied upon and compared with a sample from the actual supply or

reports filed of the sample by which agreement was entered into as

compared to the actual rice which was supplied. Admittedly, no

sample of rice or any report as to what was agreed to be sold was filed

in the Trial Court and also there was no sample or report filed to show

that when the actual rice was supplied the same was not as per the

agreed sample. Not only that, there is no written purchase order filed

in the Trial Court as to what exactly is the quality of rice which was

agreed to be sold. This is necessary because in order to make out a

case of defective supply, it has first to be shown that what was the

agreed quality of rice, which was to be supplied under the contract.

One clinching aspect that the rice could not be of a defective quality is

that the rice was delivered to the respondent/plaintiff F.O.R. Kandla,

i.e. free on rail to Kandla in Gujarat. At the stage when the

respondent/plaintiff took delivery, he was bound to examine the rice

supplied, both for quality and quantity, before exporting the same to

Dubai, UAE. If the rice was really defective and insufficient in quantity,

as supplied by the appellant/defendant, then not only the

respondent/plaintiff should have prepared an appropriate report as to

the defective quality of rice before the same was exported, or the rice

should not have been exported. It does not lie in the mouth of the

respondent/plaintiff to accept the rice, export the same and thereafter

contend that the rice is defective, qua quality and quantity when the

goods have already been accepted and exported by the

respondent/plaintiff. Useful reference in this behalf to Section 42 of

the Sale of Goods Act, 1930 which specifies that the buyer is deemed

to have accepted the goods when he does an act with reference to the

goods which implies acceptance. Export of rice is a clear cut

implication of acceptance that the rice supplied was as per the

contract. Another aspect is that that certain cheques were given for

payment with respect to the rice supplied to the appellant/defendant,

and which cheques would not have been given if the rice supplied was

defective. In view of the above, I set aside the finding and conclusion

of the Trial Court in the impugned judgment that the

appellant/defendant is guilty of supplying defective and insufficient

rice. Also, the letter of the so-called foreign buyers in Dubai, UAE

would not in any manner help the respondent/plaintiff because there is

no correlation in the letter, Ex.PW1/1 which is written by the foreign

buyer, to the rice which was sold by the appellant/defendant to the

respondent/plaintiff. What is material is the contract and the quality

which was agreed to be sold by the appellant/defendant to the

respondent/plaintiff and not that was the contract for supply between

the respondent/plaintiff and the foreign buyer in Dubai, UAE.

7. The appeal is therefore accepted. The impugned judgment

and decree is set aside. The suit of the respondent/plaintiff will

accordingly stand dismissed. Interim orders stand vacated. Decree

sheet be prepared. Trial Court record be sent back.

MARCH 15, 2011                                 VALMIKI J. MEHTA, J.
ak