Rahul Jain vs Vasant Raj Pandit
2015 Latest Caselaw 5859 Del

$~5
*     IN THE HIGH COURT OF DELHI AT NEW DELHI
+     CS(OS) 623/2005
RAHUL JAIN                                               ..... Plaintiff
                           Through:     Mr. Gurmehar Sistani, Advocate.


                           Versus


VASANT RAJ PANDIT                                         ..... Defendant
                           Through:     Mr. Jagdev Singh, Advocate with Mr.
                                        Ankit Gyan, Advocate and Mr.
                                        Aishwarya Kumar, Advocate.
CORAM:
HON'BLE MR. JUSTICE VALMIKI J. MEHTA
             ORDER

% 12.08.2015

I.A. No.22699/2014 (under Order 12 Rule 6 CPC)

1. This is an application filed by the plaintiff under Order 12 Rule

6 of the Code of Civil Procedure, 1908 (CPC) for decreeing the suit for

recovery of Rs.42,59,309/-. The cause of action as averred in the plaint is

that plaintiff was appointed as a distributor by the defendant for marketing

of the products "Japan Life Total Sleeping System" and plaintiff was

entitled to commission on sale of such products. The amount claimed in the

suit is said to be commission due to the plaintiff for sale of products as a

CS(OS) No.623/05 page 1 of 8 distributor of the defendant.

2. By this application, it is argued that the amount which is

claimed in the suit is that the amount with respect to which the defendant

had issued a total of 11 TDS certificates and once the 11 TDS certificates

are found to be issued by the defendant, the defendant is liable to pay the

suit amount to the plaintiff. It is also argued that the TDS certificates are

deemed to be admitted inasmuch as defendant was given repeated

opportunities for admission/denial of the documents of the plaintiff

(including the TDS certificates) but the defendant has failed to conduct

admission/denial and right to conduct admission/denial by the defendant was

closed in terms of the order dated 5.10.2010 passed by the Joint Registrar of

this Court. It is argued that though there is no formal order of the deemed

admission, however, in view of the order dated 5.10.2010 provisions of

Order 12 Rule 2-A, 3-A and 4 CPC will come into play as a result of which

the TDS certificates are deemed to be admitted by the defendant.

Applicant/plaintiff also places strong reliance upon the letter dated

30.4.2012 addressed by the defendant to the police wherein the plaintiff is

shown as a distributor of the defendant and also that defendant had issued

CS(OS) No.623/05 page 2 of 8 the TDS certificates.

3. The defendant by filing the written statement has disputed the

claim of the plaintiff. Besides disputing the claim of the plaintiff, in para 5

of the reply on merits, the defendant has pleaded the defence that assuming

for the sake of arguments though not admitting that plaintiff is entitled to

moneys claimed as incentives even then the defendant would not be liable to

pay the suit amount to the plaintiff which would have to and will stand

adjusted against the amount cheated/embezzled by the plaintiff. Details of

the embezzlement is stated in the earlier part of para 5. Para 5 of the written

statement reads as under:-

"5. That the contents of para 5 are wrong and hence denied. It is denied that the defendant towards commission payable to the plaintiff under the agreement under writing between the parties fully acknowledged. A sum of Rs.35,67,151.58 as due and payable to the plaintiff. It is submitted that the issuance of TDS certificates does not amount to any acknowledgment of due as the plaintiff has alleged in the para under reply. No amount whatsoever is due and payable to the plaintiff by the defendant and all these allegations are totally wrong and baseless. In fact, the plaintiff with two other distributor/Independent representatives who were responsible for day to day affairs of the defendant concern embezzled and defrauded the defendant to the tune of Rs.3,43,03,807/-. When the fraud committed by the said Independent representatives was detected by the auditors, the plaintiff was thereafter immediately terminated by the defendant from the status of Japan Life Independent Representative. Further, the defendant thereafter filed a criminal complaint being FIR No.282 of 2003 at Sarojini Nagar Police station CS(OS) No.623/05 page 3 of 8 on 16.6.03 under section 406, 420, 120B IPC. Subsequently the plaintiff as a counter blast to the said FIR, filed an FIR being No.250 of 2004 on 20.5.2004. The belated present suit has also been filed by the plaintiff to escape from his aforesaid criminal liability. It is submitted that as per the applicable rules of M/s Frontier Trading an Independent representative who is in breach, default or in violation any of the terms, conditions and/or rules applicable to them shall not be entitled to receive any further incentives whether or not the sales for such incentives have been completed. The plaintiff has accepted the said terms & conditions and had acted upon it. Having taken advantage of the said terms & conditions, it is not open for the plaintiff to challenge the same. Therefore the plaintiff is not entitled to any incentive as per the applicable terms, conditions and/or rules. Assuming for the sake of arguments though not admitting that the plaintiff is entitled to some incentives, even then the defendant would not liable to pay any amount to the plaintiff as the same would stand adjusted/set off against the amount cheated/embezzled by the plaintiff as aforesaid." (underlining added)

4. In this suit, in view of the pleadings, the following issues were

framed on 18.11.2010:-

"(1) Whether the plaintiff was appointed as distributor for marketing the products of the defendant as alleged in the plaint? OPP.

(2) Whether the plaintiff is entitled to any commission from the defendant and if so, to what amount? OPP.

(3) Whether the plaintiff is entitled to any interest from the defendant and if so, at what rate and for what amount? OPP.

(4) Relief."

5. After framing of issues, case has proceeded for recording of

CS(OS) No.623/05 page 4 of 8 evidence and presently plaintiff is in witness box and he is being cross-

examined by the counsel for the defendant. It is at this stage that the subject

application under Order 12 Rule 6 CPC has been filed by the

plaintiff/applicant.

6. No doubt, an application under Order 12 Rule 6 CPC can be

moved at any stage. However, it is required to be noted that in law there are

two types of evidences and admissions; one type of admissions are judicial

admissions and evidences which stand on much higher pedestal than

evidentiary admissions and evidences and the second type are evidentiary

admissions, and the latter evidences cannot be a basis for straightway

disposal of the suit under Order 12 Rule 6 CPC because evidence of each

party at different stages of the suit are only different parts of the complete

evidences, and in law totality of the evidences only can be seen after

evidence is completely led by both the parties. Some evidence of each

party, for and against the party, available at different stages of a suit, cannot

be a basis that at the intermediate stages in the suit, when there are disputed

questions of fact on which trial has to take place, the suit has to be decreed

under Order 12 Rule 6 CPC. It is necessary at this stage to refer to

CS(OS) No.623/05 page 5 of 8 observations of the Supreme Court in the case of Nagindas Ramdas Vs.

Dalpatram Locharam alias Brijram & Ors., AIR 1974 SC 471 wherein the

Supreme Court has marked out a clear cut distinction between the

evidentiary admissions and judicial admissions and which para 26 reads as

under:-

"26. From a conspectus of the cases cited at the bar the principle that emerges is that if at the time of the passing of the decree, there was some material before the Court, on the basis of which the Court could be prima facie satisfied, about the existence of a statutory ground for eviction, it will be presumed that the Court was so satisfied and the decree for eviction apparently passed on the basis of a compromise, would be valid. Such material may take the shape either of evidence recorded or produced in the case or, it may partly or wholly be in the shape of an express or implied admission made in the compromise agreement itself. Admission is true and clear are by far the best proof of the facts admitted.

Admissions in pleadings or judicial admission admissible under Section 58 of the Evidence Act, made by the parties or their agents at or before the hearing of the case, stand on a higher footing than evidentiary admission. The former class of admissions are fully binding on the party that makes them and constitute a waiver of proof. They by themselves can be made the foundation of the rights of the parties. On the other hand evidentiary admissions which are receivable at the rival as evidence are by themselves not conclusive. They can be shown to be wrong."

(underlining added)

7. In the present case, TDS certificates would be evidentiary

CS(OS) No.623/05 page 6 of 8 admissions only and not judicial admissions of evidence for the same to

form a basis at this stage itself for decreeing of the suit although issues have

been framed with respect to disputed questions of facts and evidence is

going on. It is also required to be noted that observations of the Supreme

Court in the case of Nagindas Ramdas (supra) are in terms of Section 31 of

the Indian Evidence Act, 1872 which states that admissions are not

conclusive though they may operate as estoppels. Evidence which therefore

exists at an intermediate stage of a suit would be relevant to one party to

prove his case, but such evidence can always be questioned by leading

evidence by the other side and also by cross-examining the witness of the

other party.

8. In the present case, the issue no.2 will cover the defence of the

defendant with respect to adjustment that if any amount is due and payable

to the plaintiff the same would be adjusted against the adjustment to be

given to the defendant for the amounts which as per the defendant are said to

have been embezzled by the plaintiff. This disputed question of fact entitles

the defendant to lead the evidence to show as to how the plaintiff has

embezzled money and such amounts of moneys are to be adjusted against

the claim of the plaintiff in the suit.

CS(OS) No.623/05 page 7 of 8

9. In view of the above, the present is not a fit case in which the

suit for recovery of money should be straightway decreed. To allow the

application is to summarily reject the defence of the defendant without

allowing the defendant to lead evidence on his defence which is a disputed

question of fact requiring leading of evidence by the defendant. The

application is therefore dismissed. No costs.

+CS(OS) No.623/2005

10. List before the Joint Registrar for fixing dates for recording of

evidence on 17th November, 2015.

                                                VALMIKI J. MEHTA, J

AUGUST 12, 2015
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CS(OS) No.623/05                                           page 8 of 8