Shri Roop Lal Jindal vs M/S. Edmond International & Ors.
2011 Latest Caselaw 4636 Del

*               IN THE HIGH COURT OF DELHI AT NEW DELHI

+                            RFA No.288/2001

%                                                       20th September, 2011

SHRI ROOP LAL JINDAL                                         ...... Appellant
                                        Through:     Mr.    S.K.      Chaudhary,
                                                     Advocate.

                             VERSUS

M/S. EDMOND INTERNATIONAL & ORS.                               ...... Respondents

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. By this Regular First Appeal under Section 96 of the Code of

Civil Procedure, 1908 (CPC) the appellant/plaintiff impugns the

judgment and decree dated 14.3.2001, and by which judgment the suit

of the plaintiff/appellant was instead of being decreed for

Rs.2,03,037.77/- was only decreed for Rs.12,276.25/-.

2. The facts of the case are that the appellant/plaintiff was the

owner of two sole proprietorship concerns, namely, M/s. Deepak

Handloom Industries and M/s. Sona Handlooms. The subject suit

pertained to eight bills, exhibited as Ex.PW1/2 to Ex.PW1/9, which are of

the period from 1.7.1987 to 7.9.1987, and by which the

appellant/plaintiff through its proprietorship concern M/s. Deepak

Handloom Industries supplied goods being Bukle fabrics to the

defendants. On the failure of the defendants/respondents to pay the

amounts due, the appellant/plaintiff had sent a legal notice dated

4.1.1988, Ex.PW1/38, and to which the respondents/defendants replied

vide reply Ex.PW1/39. Since the respondents/defendants still failed to

pay the amount due, the subject suit came to be filed.

3. In the written statement, the main defence of the

respondents/defendants was that they did not have any dealing with

M/s. Deepak Handloom Industries but had dealing with only M/s. Sona

Handlooms which of course was admitted to be the sole proprietorship

concern of the appellant/plaintiff. It was also simultaneously contended

that goods supplied by M/s. Deepak Handloom Industries were defective

and therefore no payment was due to M/s. Deepak Handloom Industries.

It was also alleged that there was no privity of contract with M/s.

Deepak Handloom Industries and the respondents/defendants only had

a contract with M/s. Sona Handlooms. The respondents/defendants

denied having received any material from M/s. Deepak Handloom

Industries.

4. The appellant/plaintiff during the pendency of the suit

amended the plaint to include besides M/s Deepak Handloom Industries,

M/s. Sona Handlooms as a co-plaintiff.

5. After pleadings were complete, the trial Court framed the

following issues:-

"I Is the suit barred u/s 69 of the Partnership Act? OPD II Is the suit bad for misjoinder of cause of action? OPD III Is the suit barred by limitation? OPD IV Is the suit maintainable in its present form? V Was there any shortfall or defect in the supply of goods by the plaintiffs to the defendants? OPD VI What amount is the plaintiff entitled to recover against the goods supplied to the defendants? OPP VII Is the plaintiff entitled to recover any interest from the defendants? If so, at what rate? OPP VIII Relief."

6. Issue Nos. I to V were held in favour of the

appellant/plaintiff. Finding with respect to issue No.V is very relevant

because finding on this issue showed that goods were in fact received

from M/s. Deepak Handloom Industries and the respondents/defendants

failed to prove that goods were defective or short supplied. The main

issues are actually issue Nos.VI and VII with respect to entitlement of

the plaintiff/appellant to recover the suit amount.

7. While dealing with these issue numbers VI & VII, the trial

Court has held that though the bills were of M/s. Deepak Handloom

Industries, however, challans were of M/s. Sona Handlooms and

therefore it was held that no goods were supplied by Deepak Handloom

Industries. It was also found by the trial Court that it was an admitted

fact that nothing was due to M/s. Sona Handlooms. The trial Court

however also found that the respondents had issued in favour of M/s.

Deepak Handloom Industries a hundi and cheque, Ex.PW1/36 and

Ex.PW1/31 respectively, which were with respect to bill Nos.69,

Ex.PW1/8 for a sum of Rs.27,060.87/- and against which one bank draft

of Rs.20,000/- was found to have been received by the

appellant/plaintiff. There was also a debit note of Rs.7,060.87/- and

therefore deducting Rs.27,060.87/- from the amount of the hundi of

Rs.39,337.12/- a decree for a sum of Rs. 12,276.25/- was passed in

favour of the appellant/plaintiff.

8. In my opinion, the appeal deserved to succeed and the trial

Court has fallen into a clear and obvious error in holding that M/s.

Deepak Handloom Industries never supplied any goods to the

respondents/defendants. Firstly, the case of the

respondents/defendants in the trial Court was inconsistent and mutually

irreconciliable because once it is admitted that goods were in fact

received from M/s. Deepak Handloom Industries, and which were

alleged to be defective and short supplied and consequently whereupon

it was claimed that there was no liability, thereafter it did not lie in the

mouth of the respondents/defendants to allege that there was no privity

of contract with M/s. Deepak Handloom Industries. In any case, when a

sole proprietor carries on business, in whatever name, the entitlement

is still of the individual sole proprietor and the sole proprietor of both

Deepak Handloom Industries & Sona Handloom was the

plaintiff/appellant. Once the respondents/defendants admitted having

received goods from M/s. Deepak Handloom Industries and it failed to

prove that goods were defective or short supplied, nothing further was

required to establish the liability of the respondents/defendants. The

trial Court has also erred in holding that merely because challans were

of M/s. Sona Handlooms and bills were of M/s. Deepak Handloom

Industries, no amount would be due to M/s. Deepak Handloom

Industries. The logic employed by the trial Court is incorrect because

goods may be supplied from any source, however, liability will be with

respect to the entity which draws the bills and once the goods are found

to be received, I really fail to understand the dispute which was raised

on behalf of the respondents/defendants with respect to its liability to

make payments for the goods received. Whatever doubt existed with

respect to issue of privity of contract with M/s. Deepak Handloom

Industries, and that no goods were received allegedly by the

respondents/defendants, the same is removed by referring to the legal

notice Ex.PW1/38 dated 4.1.1988 issued by the appellant to the

defendant No.1 partnership firm, and in which the details of the supply

against different bills are mentioned in para 3 and, in reply to this notice

the respondents/defendants vide Ex.PW1/39 only disputed the receipt of

goods with respect to two bills dated 5.8.1987 and 7.9.1987 not the six

other bills. Therefore the trial Court ought to have held that with

respect to six other bills there was no dispute. Also, the cheque

Ex.PW1/31 dated 3.11.1987 was issued by the defendant

No.1/respondent No.1 firm in favour of M/s. Deepak Handloom

Industries once again clearly showing that there was no basis

whatsoever in the defence that the respondents did not receive any

supply from M/s. Deepak Handloom Industries. Not only the cheque was

issued but a hundi dated 14.8.1987 Ex.PW1/36 was issued by the

appellant and accepted by the respondent No.1 firm towards the liability

of one bill issued by M/s. Deepak Handloom Industries and with respect

to which the trial Court in any case granted the decree. Therefore, the

impugned judgment and decree is clearly incongruous when it holds

that the appellant failed to prove any supply of goods for and on behalf

of M/s. Deepak Handloom Industries. As already stated above, the bills

were exhibited as Ex.PW1/2 to Ex.PW1/9 and the challans showing the

supply of goods though in the name of M/s. Sona Handlooms, but yet

showing the supply, were duly exhibited as Ex.PW1/10A to Ex.PW1/10D.

An additional aspect also is that the appellant/plaintiff proved the

receipt of the goods by the defendant No.3/partner on behalf of the

defendant no.1/partnership firm and also by its employees including the

driver one Mr. Tillu, however, neither the defendant No.3 was produced

in the witness box nor was any document filed to show that the driver

was not employed by the respondents/defendants.

9. A civil case is decided on balance of probabilities. The

balance of probabilities requires that the subject suit be decreed

inasmuch the bills were proved and exhibited, the challans were proved

and exhibited, the legal notice and reply were proved and exhibited and

one cheque and hundi issued in favour of M/s. Deepak Handloom

Industries were also proved and exhibited. Therefore M/s. Deepak

Handloom Industries, whose proprietor was the appellant/plaintiff/Sh.

Roop Lal Jindal was entitled to decree for the suit amount.

10. I, therefore, hold that the suit of the appellant/plaintiff for

recovery of Rs.2,03,037.77/- is entitled to be decreed alongwith

pendente lite and future interest @ 9% simple till payment and I decree

to the same accordingly. The appellant/plaintiff will also be entitled to

costs of this appeal. Appeal is accordingly allowed. Decree sheet be

prepared. Trial Court record be sent back.

SEPTEMBER 20, 2011                              VALMIKI J. MEHTA, J.
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