Dentsply India Pvt. Ltd. vs Excel International And Ors.
2012 Latest Caselaw 4031 Del

*              IN THE HIGH COURT OF DELHI AT NEW DELHI

+                           CS(OS) No.410/1999

%                                                         10th July, 2012

DENTSPLY INDIA PVT. LTD.                                       ...... Plaintiff
                  Through:               Mr. Dheeraj Kumar & Mr. Rajesh Kumar,
                                         Advocates.

                            VERSUS

EXCEL INTERNATIONAL AND ORS.              ...... Defendants
                 Through: Mr. Ajay Verma & Mr. Amit Mehra,
                          Advocates.

CORAM:
HON'BLE MR. JUSTICE VALMIKI J.MEHTA

    To be referred to the Reporter or not?    Yes.


VALMIKI J. MEHTA, J (ORAL)

1.

Issues are framed under Order 14 CPC. Issues are framed on material

propositions of fact or law urged by one party and denied by the other. Framing of

issues is considering the pleadings which are filed by the respective parties and

also the other material on record. Consideration of the record at the time of framing

issues prevents unnecessary issues from being framed and unnecessary evidence

being led by both the parties, and, it also thus prevents unnecessary elongation of

the case and prevents the record from becoming bulky. At the stage of framing of

issues, Courts have to ensure that only those issues are framed which arise from the

record of the case. If it is found that really the issue urged to be framed does not

arise or the law bars the framing of the issue sought to be framed, then, such an

issue need not be framed.

2. With this preface, let me set down the respective cases of the parties which

are today being urged before me. The case of the plaintiff is simple. The plaintiff

says that it deals with dental equipment and dental products. Plaintiff says that

defendants were appointed by it as distributor of the goods of the plaintiff. The

plaintiff, however, says that this relationship was a principal to principal basis i.e

the plaintiff is the seller and the defendants are buyers of goods and consequently

the defendants are liable to pay for the value of the goods which have not been

paid.

3. Defendants have filed their written statement-cum-counter claim. A reading

of the written statement shows that besides the complete denial of the claim of the

plaintiff, defendants have taken up, what the defendants contend are 'alternative'

stands. The defendants firstly, as per the stand taken before me today, contend that

the relationship between the plaintiff and defendants was not on principal to

principal basis, and the defendants were acting only as an agent who never

purchased the goods from the plaintiff and the defendants simply transferred goods

which were taken from the plaintiff ahead to other dealers/purchasers of the

plaintiff. For providing of such services, the defendants received commission from

the plaintiff. The defendants therefore, claim that since they have not purchased the

goods from the plaintiff, they are not liable to pay value of the goods to the

plaintiff, and if the plaintiff has to recover money, it has to recover moneys from

and to whom the goods have been transferred by defendants. It is pleaded that

defendants are entitled to various adjustments totaling to ` 46,57,815.84. This

figure of ` 46,57,815.84 comprises of three claims. The first figure is the claim of

commission of ` 27,85,663.54 for goods delivered to the dealers of plaintiff. The

second figure of ` 9,50,874.55 is the value of the goods taken back by the plaintiff

and for which adjustment is claimed. The third figure is an amount for `

9,21,277.75 being the amount which the defendants say has been admitted by the

plaintiff to be payable to defendants. Defendants have also pleaded what it says is

an 'alternative' defence. Counsel for the defendants urges before me that this

'alternative' defence is that defendants should be taken as a buyer of the goods,

however, the defendants are stated to be not liable on account of adjustments

claimed in the written statement. Defendants seek to get issues framed on the basis

of its defence which it calls 'alternative' defence. For the reasons given

hereinafter, in my opinion, the 'alternative' stand that the defendants for being

taken as the buyer of the goods from the plaintiff is not an 'alternative' stand but a

mutually destructive stand when taken with the stand that defendants are only

agents as stated above. Hence, I would not frame issues on this aspect. I say

'mutually destructive' because if the stand of the defendants being buyers is

accepted, and which they will have to admit in their evidence, the same will lead to

a most anomalous position and which if predicated destroys the first defence of

principal and agent relationship. Alternative defences are permissible but not

mutually destructive stands. Defendants also seek to get an issue as to territorial

jurisdiction framed and which for the reasons given hereinafter I decline to frame.

4. The following issues arise as per the respective pleadings of the parties on

the basis of which issues are sought to be framed:-

1. Whether the plaintiff is entitled to an amount of ` 2,81,08,673.78 from the defendants? OPP

2. Whether the aforesaid amount of ` 2,81,08,673.78 is liable to be reduced on account of goods delivered back to the plaintiff during the pendency of the suit, and if so for what amount? - Onus on parties.

3. Whether the plaintiff is entitled to interest, if so from which date and at what rate? - OPP

4. Whether the plaintiff is not entitled to recover from the defendants any amounts inasmuch as the defendants were not acting with the plaintiff on principal to principal basis i.e. not with the plaintiff as the seller and the defendants as buyers, inasmuch as the defendants were only agents who transferred goods received from the plaintiff to further dealers of the plaintiff?- OPD

5. Whether the defendants are entitled to adjust an amount of ` 46,57,815.84/- in terms of their written statement?- OPD

6. Whether the defendants are discharged from the liability towards the plaintiff for an amount of ` 67,91,334/- inasmuch as the plaintiffs have already collected these amounts from their own dealers and with respect to goods which were supplied by the plaintiffs to the defendants, and which the defendants further transferred in their capacity as an agent to other dealers of the plaintiff?-OPD

7. Relief.

5. The defendants urge framing of an issue as to lack of territorial jurisdiction

of this Court. In a contractual matter, the jurisdiction of a Court arises from four

aspects. The first is where the contract is entered into. Second is where the

contract is to be performed. The third is where moneys have to be paid under the

contract and fourthly where the defendants in the suit are residing or voluntary

working for gain. This is the ratio of the judgment of Supreme Court in the case of

ABC Laminart Pvt. Ltd. & Anr. vs. A.P.Agencies, Salem, AIR 1989 SC 1239. If

there is more than one Court which has territorial jurisdiction, then parties by

contract can restrict the jurisdiction to one or more of the Courts which have

jurisdiction, however, parties by consent cannot confer jurisdiction on a Court

which otherwise does not have any. In the present case the only reason which is

urged for pleading that this Court has no territorial jurisdiction is because the

goods are alleged to be supplied by the plaintiff from its godowns at Gurgaon,

taken with the fact that all the invoices specifically contain the condition that only

the Courts in Haryana will have exclusive territorial jurisdiction.

6. In my opinion no issue arises as to lack of territorial jurisdiction of the

Delhi Courts inasmuch as merely because the goods are dispatched from particular

place, such place cannot be the court where territorial jurisdiction arises in

contractual matter. It is the place where the goods are to be delivered is the place

which would have territorial jurisdiction as that is the place where contract is

performed. The place from where goods are dispatched is not the place where

whole or part of the contract is said to be performed inasmuch as the

buyer/defendant has not accepted delivery at Gurgaon. In the present case, Courts

at Haryana thus have no territorial jurisdiction as no part of cause of action has

arisen in such Court, and therefore, once Courts at Haryana are not such Courts

where whole or part of the cause of action has arisen, then parties cannot by

consent confer jurisdiction on such Court which does not have any. I thus decline

to frame the issue of territorial jurisdiction, as mere pleading does not mean that

issues have to be compulsorily framed once the issue is answered i.e. does not

arise.

7. No other issues are pressed or arise.

8. Parties will file their list of witnesses within a period of four weeks from

today. Plaintiff will file affidavits of its witnesses within a period of six weeks

from today.

9. List the matter on 6th August, 2012 before the Joint Registrar for fixing dates

for cross-examination of the plaintiff's witnesses.

JULY 10, 2012                                         VALMIKI J. MEHTA, J.
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