M/S. Prime Hortiagro Projects ... vs M/S. Competent Conveyor Systems ...
2011 Latest Caselaw 4291 Del

*             IN THE HIGH COURT OF DELHI AT NEW DELHI

+                          RFA No.285/2002

%                                                 2nd September, 2011
M/S. PRIME HORTIAGRO PROJECTS LTD.                      ......Appellant
                          Through:          Mr. A.P. Mukundan, Advocate

                          VERSUS

M/S. COMPETENT CONVEYOR SYSTEMS PVT. LTD.             ...... 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 Code of Civil Procedure, 1908 (CPC), is to the impugned

judgment and decree dated 11.2.2002 of the trial Court whereby the suit

of the respondent for recovery of Rs.3,26,800/- was decreed against the

appellant/defendant alongwith pendente lite and future interest @ 12%

per annum.

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

to have entered into a contract with the appellant/defendant as per the

purchase order placed by the appellant/defendant on 25.9.1997. The

respondent/plaintiff contended that it had to supply machinery/conveyor

systems to the appellant/defendant for the total value of Rs.16 lacs and

that it did in fact supply this machinery/conveyor systems vide invoice

Nos.242 to 245 dated 12.11.1997 and 15.11.1997 totaling to Rs.16 lacs.

The respondent/plaintiff further averred that the appellant/defendant

made two payments of Rs.7,60,000/- and Rs.6,50,000/- but did not make

the balance payment of Rs.1,90,000/-. It was further alleged that the

appellant/defendant was issued various letters which had no effect. The

respondent/plaintiff further averred that though the appellant/defendant

issued the necessary sales tax forms for the complete amount of the

contract value of Rs.16 lacs, however, it did not pay the balance amount

and therefore the subject suit came to be filed.

3. The main defence of the appellant/defendant in the trial

Court was that the respondent/plaintiff in addition to supply of

machinery/conveyor systems was also liable to do the commissioning of

the machinery/conveyor systems and since the respondent/plaintiff failed

to do the job of commissioning, no payment was due to the

respondent/plaintiff. The appellant/defendant also argued that as per the

terms of the contract, though balance payment was to be made only on

successful commissioning, however, the respondent/plaintiff committed

interpolation in the terms and conditions of the contract whereby the

word "delivery" was substituted for the word "commissioning". It was

then the stand of the appellant/defendant that because the

respondent/plaintiff failed to do the job of commissioning, the

appellant/defendant had to do the job of commissioning and for which it

incurred expenditure and therefore no amount was payable to the

respondent/plaintiff.

4. The relevant issue in this regard was issue No.iii framed by

the trial Court and which issue reads as under:-

"iii. Whether the plaintiff is entitled to recovery any amount from the deft.? If so, how much? OPP"

5. The trial Court has while dealing with issue No.3 from internal

pages 9 to 15 of the impugned judgment held that the

respondent/plaintiff was not liable for the job of commissioning, and

therefore the appellant/defendant was liable to pay the suit amount.

Some of the conclusions of the trial Court in the impugned judgment, and

with which I agree, are as under:-

(i) The admitted work order placed upon the respondent/plaintiff

by the appellant/defendant dated 25.9.1997 alongwith its terms and

conditions exhibited as Ex.PW1/3 and Ex.PW1/4 showed that the contract

value of Rs.16 lakhs was arrived at by totaling of the price/value of eight

machineries as mentioned in the first page of Ex.PW1/3 and therefore

there was no question of any commissioning being done by the

respondent/plaintiff as the price was only towards supply of the

machinery.

(ii) Even in the proforma invoice dated 8.11.1997 Ex.PW1/D5

which was sent with the covering letter dated 13.11.1997, Ex.PW1/D4 by

the respondent/plaintiff to the appellant/defendant again only contained

the value of the contract as Rs.16 lakhs with respect to eight items of the

machinery which were to be supplied.

(iii) If the scope of work of the respondent/plaintiff included the

job of commissioning, then, the respondent/plaintiff was entitled to

additionally 7-1/2% for installation charges or supervision charges of

Rs.1500/- per day plus free lodging, boarding etc. in terms of the clause

(IX) of the clause of prices as found in the original offer of the

respondent/plaintiff dated 9.7.1997 Ex.PW1/D2 i.e. price of

installation/supervision charges/commissioning was in fact in addition to

the price of the machinery supplied and these aspects were conspicuous

by their absence in the supply orders dated 25.9.1997 Ex.PW1/3 and

PW1/4 and therefore the commissioning was not the liability of the

respondent/plaintiff.

(iv) The appellant/defendant had issued necessary sales tax

forms (ST-1) for the complete amount of the contract of Rs.16 lakhs and

which would not have been done if the respondent/plaintiff had not

completed the work.

6. Some of the relevant observations of the trial Court, in this

regard, read as under:-

"Even if it is assumed, that the defendant placed its purchase order upon the techno-commercial offer dated 9.7.97 Ex.PW1/D2, in my considered view for various reasons it cannot be said that the plaintiff undertook to install and commission the conveyor systems at the site of M/s. North Eastern Regional Agricultural Marketing Corporation Ltd. at Guwahati. A bear perusal of techno-commercial offer Ex.PW1/D2 by itself provides that besides the prices of the conveyor systems, the plaintiff also provided for charging installation @ 7-1/2% or supervision charges of Rs.1,500/- per day plus free lodging, boarding, travelling and local conveyance at site. Purchase order Ex.PW1/3 of the defendant is, however, totally silent on this core. The purchase order of the defendant by itself does not make any mention of any installation charges or supervision charges but for only the price of the conveyor systems. There is not even an iota of any mention anywhere in the purchase order as regards any installation or supervision charges that could be payable to the plaintiff besides the prices of the conveyor systems. What was exactly offered by the plaintiff against which the defendant placed his purchase order Ex.PW1/3, the defendant by itself has not preferred to produce before the Court, in as much as, as said earlier, the purchase order of the defendant is against the offer letter No.SPY/PHPL?239/97 dated 22.9.97 and not the techno-commercial offer Ex.PW1/D2. Not only that, the bills raised by the plaintiff upon the defendant which undisputedly are Ex.PW1/5 to Ex.PW1/8 relate to only as regards the prices of the conveyor systems in total amounting to Rs.16,00,000/- against the

sales Tax-1 forms. The prices of the conveyor systems as per the bills Ex.PW1/5 to Ex.PW1/8 have not been disputed in any manner, whatsoever. Admittedly, the defendant issued the ST forms to the plaintiff and the unchallenged and unrebutted testimony of PW1 that the ST forms issued by the defendant to them were for the full value of Rs.16,00,000/- for which they had supplied the goods, further establishes the fact that the plaintiff supplied the goods, that is the conveyor systems to the defendant for the total value of Rs.16,00,000/- against the bills Exs. PW1/5 to Ex.PW1/6. The value of the price of the goods so sold at Delhi by no means can be said to be connected with any obligation on the part of the plaintiff to install and commission the conveyor systems at the site at Assam. Even the DW1 who is the Director of the defendant company, during his cross- examination has admitted it to be correct that the plaintiff in his quotation/order Ex.PW1/D2 had quoted separately for installation and affixation charges of the conveyor system, but they did not accept it. That also simply implies that the defendant on its part did not accept the offer of the plaintiff to install and commission the conveyor systems and the purchase orders were placed by the plaintiff only for the supply of the conveyor systems sans their installation and commissioning. As regards the alleged interpolations made in the terms and conditions forming part of the purchase order, the mere testimony of DW1 that it had been done by the plaintiff by putting the word „delivery‟ against the word „commissioning‟ applying the whitener, I do not find to be creditworthy or reliable, for the reasons aforegoing, as also for the reason that the purchase order was not either signed by DW1 or said to have been signed on his instructions in his presence. The person who signed the purchase order and who only could depose about such a state or the circumstances in which the word „delivery‟ after applying the whitener came to be put in the purchase order, for the reasons unexplained has not been produced before the court by the Defendant. Letters which the defendant alleges to have written to the plaintiff for the non-commissioning of the conveyor systems by the plaintiff, I find, the defendant on its part has failed to prove having written and sent by it to the plaintiff. DW1 as for the mode of sending such letters during

his examination-in-chief has deposed that they used to make the payment by ordinary mail along with covering letter. Who used to dispatch such letters and if any record was being maintained for such despatches, while the testimony of DW1 is silent, no evidence has come to be produced, though the defendant by itself is also a private limited company. The oral testimony of DW1 as such for the defendant company having sent any letters either enclosing any cheques towards payment or otherwise for the non-installation or non- commissioning of the conveyor systems by the plaintiff, I do not find to be either trustworthy and reliable. I am, therefore, of the considered view that the defendant on his part has utterly failed to prove that the plaintiff was under any obligation to install and commission the conveyor system supplied against the invoices Ex.PW1/5 to Ex.PW1/8." (underlining added)

7. Learned counsel for the appellant argued that even if we

refer to the letter of the respondent/plaintiff dated 13.11.1997 Ex.PW1/D4

alongwith its invoice Ex.PW1/D5 the same showed that the balance

amount was payable after commissioning of Rs.2,40,000/-. It is therefore

argued that this shows that the respondent/plaintiff was liable to do the

commissioning. In my opinion, this argument is misconceived because

timing of a payment is an aspect which is different from the scope of the

work. The scope of work of the respondent/plaintiff was only the supply

of machinery numbering in eight totaling to Rs.16 lakhs and which

becomes clear from the reading of the purchase orders dated 25.9.1997

Ex.PW1/3 and PW1/4 and the proforma invoice dated 8.11.1997

Ex.PW1/D5 and therefore mentioning that balance of Rs.2,40,000/- will be

paid after commissioning is with respect to timing of payment of the

balance and it has nothing to do with the scope of work such as to

include the commissioning having to be done by the respondent/plaintiff.

I may note that the appellant/defendant also tried to build up the case

upon certain letters which were exhibited as Ex.DW1/P1 to DW1/P5 but

the trial Court has noted that none of these documents have been proved

to have been sent to or received by the respondent/plaintiff and hence

cannot be relied upon. Also, in my opinion, therefore the argument of the

counsel for the appellant that the expression "delivery" has been

interpolated by substituting it with the word "commissioning" would not

have any effect because even if the word "commissioning" is found to be

written in Ex.PW1/3 dated 25.9.1997 instead of the word "delivery" as is

found, yet the same will only indicate the timing of the balance payment

and not the scope of the work. The scope of work continues to be only of

supply of eight machinery/conveyor systems totaling to Rs.16 lakhs and

which was the total value of the contract. There was no other additional

charges payable for any other additional work towards commissioning

and therefore commissioning was not within the scope of the contract.

8. Learned counsel for the appellant also argued that alongwith

the appeal an application under Order 41 Rule 27 CPC was filed to bring

on record the letter dated 22.9.1997 sent by the respondent/plaintiff to

the appellant/defendant and which letter does not mention about any

installation charges and the same only mentions supervision charges. I

really fail to understand as to how this letter in any manner will assist the

appellant/defendant because even this letter shows that the prices are

with respect to scope of work of supply only of the machinery/conveyor

systems and the scope of supply as per the letter dated 22.9.1997 does

not show that the respondent/plaintiff had in addition to the supply of

machinery/conveyor systems was also liable to do the commissioning of

the machinery. No clause has been pointed out to me in this letter dated

22.9.1997 of the scope of supply to include the commissioning and what

has been only pointed out is that the balance payment of 15% plus

supervision charges would be paid after successful commissioning. I

have already dealt with this aspect above that the timing of the balance

payment has nothing to do with the scope of work. In any case, this

letter dated 22.9.1997 falls into insignificance in view of the purchase

order dated 25.9.1997 Ex.PW1/3 and PW1/4 issued by the

appellant/defendant itself and which is later in point of time and which

purchase order does not include any supervision/installation charges and

it also does not include within the scope of the work any liability of the

respondent for commissioning and the scope of work is of the value of

Rs.16 lakhs arrived at by totaling the eight number of machineries to be

supplied. The application therefore even if considered will have no effect

to the result of the present appeal.

9. This Court is entitled to interfere with the impugned

judgment of the trial Court if the judgment of the trial Court is illegal or

perverse. If the trial Court takes one possible and plausible view, this

Court ought not to interfere in an appeal unless injustice is shown to be

caused. In any case, I am of the view that the trial Court has taken a

correct view because even as per the purchase orders Ex.PW1/3 and

Ex.PW1/4 placed upon the respondent/plaintiff by the

appellant/defendant the total contract was of Rs.16 lakhs and which

figure of Rs.16 lakhs is arrived at by totaling each individual cost of the

machinery/conveyor systems totaling to eight as found in Ex.PW1/3 and

there is no requirement of the respondent/plaintiff to undertake

commissioning.

10. In view of the above, I do not find any merit in the appeal.

The appeal is therefore dismissed, leaving the parties to bear their own

costs. Trial Court record be sent back.

SEPTEMBER 02, 2011                               VALMIKI J. MEHTA, J.
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