Su-Kam Power Systms Ltd vs M/S Uniworld Telecom
2014 Latest Caselaw 4236 Del

$~28
* IN THE HIGH COURT OF DELHI AT NEW DELHI

+ CS(OS) 200/2014

%                               Date of decision : 8th September, 2014

          SU-KAM POWER SYSTMS LTD            ..... Plaintiff
                   Through : Mr. Chinmay Kumar and
                             Mr.Amulya Dhingra, Advs.
                   versus

          M/S UNIWORLD TELECOM
          LIMITED & ORS                                 ..... Defendants
                   Through

          CORAM:
          HON'BLE MR. JUSTICE G.S.SISTANI

    G.S.SISTANI, J. (ORAL)

1. Plaintiff has filed the present suit for recovery of Rs.80,80,086/-

along with pendente lite interest.

2. Summons in the suit were issued on 24.01.2014. The order sheets reveal that the defendants were served on 15.05.2014. On the last date of hearing i.e 13.08.2014, defendant no.1 had made a statement that proceedings are pending before the AIFR, but he did not provide any particulars nor were any particulars available with him. Counsel for the plaintiff prays that a decree be passed under Order 8 Rule 10 CPC, as despite service the defendants have failed to file the written statement within the time allowed.

3. Counsel for the plaintiff submits that the plaint is duly supported by the affidavit of Mr. Parmeshwar Prasad Singh, Legal Manager of the plaintiff company and the same should be read as evidence

on behalf of the plaintiff. It has been averred in the plaint that the plaintiff is a limited company engaged in the business of manufacturing Invertors, Batteries, UPS, other Power Products, etc., under the brand name of Su-Kam, with nationwide network of distributors and dealers for its products.

4. It has also been averred in the plaint that the defendant no. 1 is a private limited company engaged in the business of manufacturing and trading of the telecom and electronic parts and the defendant nos. 2 to 4 are the directors of the defendant no. 1 company who are engaged in the day to day affairs and conduct of the company and has been constantly involved in the business transactions with the plaintiff company.

5. It has further been averred in the plaint that the defendant company through its officials and representatives, inter alia, the defendant nos. 2 & 3 approached the plaintiff company to be approved as official vendors for supplying various finished and semi-finished goods and after negotiations the plaintiff company agreed to do business with the defendants.

6. Plaint also discloses that it was agreed that the defendant company at its manufacturing unit shall assemble kits/parts/card/boards for the plaintiff company at job rates and the plaintiff company would arrange material and parts which are to be used for said assembling and it was further agreed that if required the plaintiff company shall open letter of credits with the defendant company as beneficiary so that the defendant company gets the raw material for assembling the parts for the plaintiff company.

7. It has also been averred in the plaint that in terms of the understanding/agreement the defendant company started

assembling products for the plaintiff company and the plaintiff company used to supply raw materials against invoices which were duly raised in the name of the defendant company and were debited in the running account of the defendant company. It has next been averred in the plaint that the plaintiff company also used to make payments to the defendant company for the assembling charges as well as for the raw materials which the defendant company was buying for assembling products for the plaintiff company. The defendant nos. 2 to 4 after being satisfied with the terms of the business dealings and after several discussions and deliberations started the commercial transactions and subsequently requested the plaintiff company for the supply of electronic control cards and display cards which included capacitors, connector fuse clip, fibre washer, fuse auto, diode (chip) and many other goods which are manufactured and marketed by the plaintiff company under it brand name "Su-Kam".

8. It has further been averred in the plaint that in the due course of business the plaintiff company used to give purchase orders for assembling products to the defendant company along with the list of raw materials required and thereafter raw materials would be arranged by the plaintiff company by itself by raising invoice upon the defendant company and some times made payments directly to the vendors for the defendant company. The plaintiff company also used to make payments to the defendant company for the assembling charges as well as for the finished products against the invoices which were raised by the defendant company in the name of the plaintiff company in due course of business.

9. Further as per the plaint, all the invoices which were raised by the defendant company are credited in the running account of the defendant company and all the payments made by the plaintiff company directly to the defendant company or to other vendors on behalf of the defendant company and for the goods sold being raw material for assembling products are duly debited in the running account of the defendant company.

10.It has also been averred in the plaint that the defendant company on many occasions bought the raw materials directly from the suppliers of the Plaintiff Company and the payments qua the raw materials used to be paid by the plaintiff company directly to the vendors and all these payments were also debited to the account of the defendant company.

11.It has also been averred in the plaint that the plaintiff company used to make payments to the defendants as per the invoices raised and the finished/ assembled goods supplied to the plaintiff company and the plaintiff company as per the requirement of the defendants supplied all the requisite raw materials directly through its factory or through its suppliers of the raw materials. Further, the detailed transactions between the defendants and the plaintiff company were recorded in the ledger account of the plaintiff company which is maintained as per the standard accounting principles.

12.Plaint also discloses that on certain occasions the plaintiff company has arranged for Letter of Credit through its bankers with the defendant company as its beneficiary and the said letter of credit has been utilized by the defendant company for its manufacturing processes and the value of the said letter of credit

has also been debited in the running account of the defendant company. It has further been averred in the plaint that the plaintiff company, on specific requests by the defendants have made the payments to the financier of the defendant company, one being M/s. Global Trade Finance Ltd. through which the defendant company has arranged finance for its day to day requirements for working capital and as well as for purchasing raw material.

13.It has also been averred in the plaint that against the payments and supplies made and arranged by the plaintiff company, the defendant company was supplying the assembled products of which payments were credited into the running account of the defendant company.

14.Further as per the plaint, the plaintiff company maintains a ledger account of all its vendors and vendees as per the standard accounting principles and since the defendant company was a vendor of the plaintiff company therefore a running creditor account was maintained wherein all the payments made to and on behalf of the defendant company have been debited in the said ledger account and all goods received have been duly credited in the account of the defendant company. It has also been averred in the plaint that the ledger account also reflects the payments made by the plaintiff company on behalf of the defendants to the supplier of the raw material which depicts that the transactions between the plaintiff and the defendant company were free from demur and the plaintiff acted in the mutual benefit of both the companies.

15.It has also been averred in the plaint that despite supplying and arranging raw materials and making payments to the defendant

company and on behalf of the defendant company, the defendant company failed to supply the assembled products to the plaintiff company and therefore a huge outstanding amount was due to be paid by the defendant company and towards the discharge of the said liabilities the defendant company resold some of the raw material which was either supplied/sold by the plaintiff company or was being paid by the plaintiff company. It has further been averred in the plaint that despite the said credit a huge amount of Rs.80,80,086.14/- was legally due and payable by the defendant company by 04.01.2011 as the goods received by the defendant company have been utilized by the defendant for their own commercial usages and benefits. The statement of account of the defendant company has been filed along with the plaint and it has been averred in the plaint that every transaction in the statement of account be read as a part and parcel of the plaint.

16.It has also been averred in the plaint that the officials of the plaintiff company have on a number of occasions called upon the defendants to pay the outstanding amount and every time the defendants and their officials assured the plaintiff that the outstanding amount will be cleared and the defendants shall make payments to the plaintiff company soon. It has further been averred in the plaint that the plaintiff company made several telephonic calls, sent reminders and requested the defendants to clear the dues but the defendants did not respond to any of the calls made by the plaintiff and started to avoid all kind of correspondences and this sudden change in behaviour of the defendants shocked the plaintiff company.

17. Further as per the plaint, despite calls, reminders and requests made by the plaintiff company, defendants did not respond which shows that defendants were having dishonest intentions from the beginning and defendant did not intend to make full payments to the plaintiff company. It has also been averred in the plaint that defendants are guilty of criminal misappropriation of goods and also guilty of cheating the plaintiff company as defendants induced the plaintiff to make payments on its behalf, arrange for letter of credits, make payments to the financer of the defendant company and also supply raw material to the defendants through various invoices and defendant company later utilized all said payments and raw materials/goods for its commercial gains and advantages.

18.Plaint also discloses that the plaintiff company issued a letter dated 27.08.2010 requesting the defendants to make the payment of Rs. 1,23,93,971.13/- but the defendants did not reply and on 03.01.2011, some of the goods which were supplied to the defendant company by the plaintiff company were returned. The amount of goods returned was adjusted in the ledger account maintained by the plaintiff company and the amount due from the defendants came to be Rs. 80,80,086.14/- which was intimated to the defendants with a request to make the payment at the earliest.

19.It has also been averred in the plaint that defendants with malafide intentions deliberately refused to pay the outstanding amount and further has no intention of making the said payments thereby usurping the legal and lawful claim of the plaintiff company.

20.It has further been averred in the plaint that the plaintiff company send a legal notice, dated 26.07.2013 to the defendant to

immediately make the payment of Rs. 80, 80, 086.14/- along with interest @ 24% from the due date of payment till the payment is made but despite service of the said legal notice the defendant did not reply and failed to pay the outstanding amount for sum of Rs. 80,80,086.14/-.

21.I have heard counsel for the plaintiff and perused the plaint and the accompanying documents. In this case, defendants were duly served on 15.05.2014. Upon service of summons the defendants entered appearance, sought time to file the written statement but no written statement has been filed nor has any application seeking extension of time to file the written statement has been filed. Therefore, plaintiff has prayed for a decree under order VIII Rule 10.

22.Documents placed on record establish the case of the plaintiff. Plaintiff has filed a copy of ledger account of the plaintiff company pertaining to defendants wherein the invoices raised by the plaintiff company for the raw materials supplied to the defendant company and for the payments made to the defendant company for assembling its products have been duly debited in the running account of the defendant company. Further the invoices raised by the defendant company for the supply of assembled products to the plaintiff company have been credited in the running account of the defendant company. Copy of the Legal Notice dated 26.07.2013 which has been placed on record shows that repeated requests were made to the defendant company to release payment and to clear the outstanding amount, however, neither the legal notice was replied by the defendants nor the outstanding amount was paid.

23.For the reasons stated above and in the absence of the written statement, the averments made in the plaint are deemed to be admitted. The fact that defendants have failed to file the written statement within time allowed, this is a fit case to pass a decree under order VIII Rule 10 CPC. Accordingly present suit is decreed in favour of the plaintiff and against the defendants in the sum of Rs 80,80,086.00 together with pendente lite and future interest at the rate of 12%.

24.Let a decree sheet be drawn up accordingly.

G.S.SISTANI, J SEPTEMBER 8, 2014