Delhi High Court
M/S U.D.K. Papers Pvt Ltd vs Shaileja Papers Ltd And Others on 19 August, 2015
Author: Manmohan Singh
* IN THE HIGH COURT OF DELHI AT NEW DELHI
% Judgment pronounced on: 19th August, 2015
I.A. No.3646/2012 & I.A. No.21393/2012 in CS (OS) 2762/2011
M/S U.D.K. PAPERS PVT LTD ..... Plaintiff
Through Mr. K.Venkatraman, Adv. with
Mr. Dinesh Kumar Chawla, Adv.
versus
SHAILEJA PAPERS LTD AND OTHERS ..... Defendants
Through Mr. A.K. Mishra, Adv.
CORAM:
HON'BLE MR.JUSTICE MANMOHAN SINGH
MANMOHAN SINGH, J.
1. The present suit has been filed by the plaintiff Company under
Order XXXVII CPC for recovery of a sum of Rs.31,29,522/- along
with pendente lite and future interest against the defendants.
2. The defendants was one of the customer of the plaintiff
Company and had purchased the material, i.e. papers time to time
from the plaintiff Company vide the Bill Nos., the details of which
have been mentioned here as under:-
S.No. Bill No. Date Amount
1. T-049 22.10.2008 Rs. 5,66,585/-
2. T-050 23.10.2008 Rs.5,32,052/-
3. T-051 24.10.2008 Rs.6,40,145/-
4. T-077 18.2.2009 Rs.78,962/-
5. T-078 18.2.2009 Rs.57,637/-
Rs.18,75,381/-
3. The bills have been filed as Annexure-2 (colly). The defendants
had purchased the material against the bills/ invoices and the terms
and conditions are reflected on the bills which are part of the contract/
agreement.
4. It is the case of the plaintiff that defendants have paid an
amount of Rs.65,000/- on 17th January, 2009 and Rs. 1,36,599/- on
16th March, 2009 as part payment against the above bills and as such
the defendants remains in balance of Rs.16,73,782/-. Since the
defendants have failed to pay the balance amount after expiry of 30
days, thus they are liable to pay interest also as per bills. As per the
plaintiff, the balance principal amount of Rs. 16,73,782/- and interest
on the delayed period which comes to Rs. 14,55,740/- calculated
upto 30th September, 2011. As per the ledger and account the above
said amount stands in the name of the defendants. Copy of the
ledger has been annexed as Annexure-3.
5. The plaintiff has demanded the aforesaid amount by serving a
legal notice dated 8th April, 2011 which was posted on 9th April, 2011
and the same has been duly served upon the defendants, but the
defendants failed to give any reply and also failed to make the
payment of the bills in question. The copy of the notice has been
annexed as Annexure -4 and Postal Receipt has been annexed as
Annexure -5. Thus, the present suit is filed.
6. After service of notice and completion of formalities, the
defendants have filed an application being I.A. No. 3646/2012 under
Order XXXVII Rules 3(5) CPC read with Section 151 CPC for seeking
leave to defend the suit inter alia on the following grounds:-
(i) The defendants are not liable to pay the amounts as there is
no liability/debt of the defendants to pay anything to the
plaintiff who came into the contact of the defendants through
one broker/agent i.e. Mr.G.S.Mishra, an independent broker
working in the paper industry. He was never the employee of
the defendants. His name was shown as 'broker' in the
records of Paper Merchant Association in Delhi at Serial No.
0021 and in the records of Association Brokers (namely
Paper Brokers Association) in paper trading business in
Delhi. He has been carrying out the job of broker for
facilitating the parties in the business of purchase and sale
amongst the said parties.
Mr.G.S.Mishra has facilitated the purchase of the paper
from the plaintiff Company for selling the same to the
defendants and other concerns and similarly in some other
cases he has been facilitating the purchase of the paper from
the defendants and other parties for selling the same to the
plaintiff Company. The goods were transacted through him in
his capacity as an 'independent broker' between the parties.
(ii) The five bills, as mentioned in para 3 of the plaint, it was
stated that the defendant No.1 did not pay the amounts
covered by the first three bills, except as stated hereinafter
and had paid for the last two bills bearing Nos. T-077 and 078
for Rs.78,962/- and Rs.57,637/- respectively (totaling to
Rs.1,36,599/-) which was accepted by the plaintiff Company
without any demur and protest and payment made for both
the bills have been admitted in para 5 of the plaint. The
plaintiff Company has not raised any protest against the non-
payment of the first three bills while receiving the payments
for the last two bills. Therefore, it is a false claim.
(iii) As far as the bill Nos. T-049, T-050 and T-051 are concerned,
it is stated that the most of the goods received through the
said bills were found to be defective having termite and was
in wet condition which could not even be stored by the
defendant No.1 with other products. The defendants had
given telephonic information to Mr.G.S.Mishra about the said
fact because he had facilitated the said transaction and the
defendant No.1 had received the said materials from him as a
common broker of both the parties. The defendants had
accordingly written letters dated 23rd October, 2008, 25th
October, 2008 and 26th November, 2008 to the plaintiff
Company through Mr. G.S.Misra, the original copies of which
are available with the plaintiff. Thereafter the discussions had
started between the parties through Mr. G.S.Misra regarding
the modes lifting the material. On 16th January, 2009, an
arrangement was made and agreed between the parties, with
the intervention of Mr. G.S.Misra, to the effect that the
defendant No.1 shall pay for the cost of the quantity of the
goods which was used by the defendant No.1 by that time i.e.
by 16th January, 2009. It was also agreed that the balance
defective goods were to be returned to plaintiff Company
through Mr. G.S.Misra. Accordingly, the defendant No.1 had
paid (through Mr. G.S.Misra) for the following goods which
were used by the defendant No.1 as per the following
details:-
Item Quantity Kg. Amount
Sunshine 51 Reem 1185.1 Rs.62,514/- + VAT
SP (25 x 36) plus 7 Kg. (at the rate 4% =
2500)
= Total Rs.65014/-
The aforesaid payment was made after rounding of
the same to Rs.65,000/-.
The balance unused defective goods were returned by
defendant No. 1 through Mr. G.S.Misra on 2nd April, 2010 and
5th April, 2010 as per the following details:-
Table-
(i)
Date Item Quantity Kg. Form No.of D-
VAT-33 Form
2.4.10 Shunshine SP 163 Reems + 3781.4 006
One Reem Loose
2.4.10 Ta Delux 217 RIM 4622.1 006
Premium
2.4.10 SS SP 48 RIMS 739.2 006
Total Rs.501585/-
Table-(ii)
Date Item Quantity Kg. Form No.D-
VAT-33 Form
5.4.10 ABC Gold 651 reems 12108.6 014
5.4.10 Maplitho Paper 1235 13832 014
Total 1172197/-
Total Tables- (i) + (ii) Rs.16,73,782/-
The aforesaid goods were returned by the defendant No.1 to the
plaintiff Company through Mr.G.S.Mishra who had delivered the
said goods to the plaintiff's godown under the signatures given
by the employee of the plaintiff as per the practice being followed
by the parties. The defendant No. 1 had also served the copies
of the Debit Notes dated 2nd April, 2010 and 5th April, 2010 along
with the Form-D-VAT-3 bearing Nos. 006 and 014 dated 2nd
April, 2010 and 5th April, 2010 to the employee of the plaintiff
Company who had been dealing on behalf of the plaintiff
Company earlier also in the transactions involving the plaintiff
Company with the defendants. The defendants would establish
the said fact during the trial that the same employee has been
acting on behalf of plaintiff in the transactions with respect to
which no claim has ever been raised by the plaintiff company.
Copies of the Forms-D-VAT-3 bearing Nos. 006 and 014 along
with the Debit Notes dated 2nd April, 2010 and 5th April, 2010,
containing the signatures of the employees of the plaintiff have
been filed as Annexure-D-3 (colly).
(iv) After the return of the goods to the plaintiff, the necessary entries
were also made in the books of the defendant No. 1 which were
duly audited and certified by the Chartered Accountant in which
the name of the plaintiff is not there. Copy of the relevant portion
of the statement of account and Audited balance sheet along
with the list of creditors of the defendant No. 1 has been
annexed as Annexure-D-4 (colly).
7. Therefore, the trial in the matter is necessary and it is denied
that the defendant No.1 is not liable to pay anything to the plaintiff.
The defendants are entitled for unconditional leave to defend the
present suit and to file detailed written statement.
8. In reply filed on behalf of the plaintiff Company to the
application, it is stated that the defendants have no defence or triable
issue. The plea taken by the defendants is malafide and afterthought,
false and concocted one, hence the application of the defendants is
liable to be dismissed. The application of the defendant is not
maintainable and is hit under the Sales of Goods Act.
9. The documents Annexure D-3 filed by the defendant in which
the address of the plaintiff has been mentioned as Godown - 11,
Goyal Farm House. It is alleged in the reply that the plaintiff Company
had left the said godown of Smt Prem Lata Goyal on 14th December,
2008 and had taken another godown in the same vicinity on 15th
December, 2008 under the ownership of Lalla. The copies of the last
rent receipt of godown of Smt.Prem Lata Goyal and the few Receipts
of Mr. Lalla have been filed. The signatures appearing on the
delivery notes and the debit notes are forged and fabricated of
Mr.Birij. The plaintiff Company has placed on record the copy of the
resignation letter of Mr.Birij which bears the signatures of Mr.Birij and
his detailed affidavit. The signatures on the documents as per
Section 73 of Indian Evidence Act which would show that the plea
taken by the defendants is false, concocted one and after thought
and had manufactured the documents after the filing of the suit with
the connivance of Sh.G.S.Mishra. The copy of the Resignation Letter
of Mr.Birij has been annexed as Annexure P-Xl and 2.
10. It is denied by the plaintiff Company that the defendant No.1
had returned the material in question on 2nd April, 2010 and 5th April,
2010 in the godown No.11 in the presence of Sh.Birij (employee of
the plaintiff). It is stated by the plaintiff that the alleged dates 2nd April,
2010 and 5th April, 2010 or on any other date as on that dates
Godown No. 11 Goyal 9 Farm House was not in the tenancy of
plaintiff and employee Sh. Birij left his employment on 31st July, 2009,
therefore, the question of accepting the alleged material on 2nd April,
2010 and 5th April, 2010 by Sh. Birij does not arise at all. The
defendants in collusion with Mr.G.S.Mishra had manufactured the
forged and fabricated documents of debit notes and delivery note
bearing No.006 and 014.
11. The plaintiff has placed on record the copies of the Salary
Account of the year 2009-10 duly attested by the C.A. The plaintiff
company has filed the said return in the Income Tax department as
well. The copy of the same has been annexed as Annexure P-X3 in
order to show that the defendants is in arrears of the liquidated
amount of the plaintiff Company and is liable to pay the same with
interest as claimed by the plaintiff Company. The defendants have
filed the forged and fabricated documents. The plaintiff's application
under Section 340 of Cr.P.C. against the defendants is pending.
12. It was denied that the defendant had given telephonic
information to Mr. G.S.Misra about the said facts because he had
facilitated the said transaction and the defendant No.1 had received
the said material from him as a common broker of both the parties. It
is also denied that the defendants had written any letter or letters
dated 23rd October, 2008, 25th October, 2008 and 26th November,
2008 to the plaintiff through Mr.G.S.Misra, the original copies of
which are available with the plaintiff. It is alleged that the material was
of good quality which the defendants had consumed and had not
raised any objection at any point of time, therefore the question of
telephonic information to Mr.G.S.Misra or writing the alleged letters to
the plaintiff by the defendants does not arise at all. No such letter has
ever been issued by the defendants to the plaintiff at any point of time
nor has any proof of despatch of said letters been placed by the
defendant No.1.
13. It is also denied by the plaintiff Company that on 16th January,
2009, an arrangement was made and agreed between the parties,
with the intervention of Mr. G.S.Misra, to the effect that the defendant
No.1 shall pay for the cost of the quantity of the goods which was
used by defendant No.1 by that time i.e. by 16th January, 2009. It is
further denied that it was also agreed that the balance defective
goods were to be returned to the plaintiff Company through
Mr.G.S.Misra. It is denied that the defendant No.1 had admittedly
paid the amount of the used goods (through Mr.G.S.Misra) as
alleged. The defendants have not denied the fact that defendant No.1
has paid part payment of the above said three bills of Rs.65,000/- on
17th January, 2009 against cheque.
14. It was denied that the same employee of the plaintiff Company
has been dealing on behalf of the plaintiff Company earlier also in the
transactions involving the plaintiff Company with the defendants and
other parties as well. The alleged forms, Delivery notes bearing
Nos.006 and 014 along with the Debit Notes are apparently
manufactured by the defendants as the plaintiff company had left the
said godown on 14th December, 2008 and had taken another godown
in the same vicinity on 15th December, 2008 under the ownership of
Lalla. The copies of the last Rent Receipt of godown of Smt.Prem
Lata Goyal and the few Receipts of Mr.Lalla has been annexed as
Annexure P-X. The signatures of the plaintiff are appearing on the
delivery notes. It is apparent that Mr.Birij, employee of the plaintiff
company had left the plaintiff company.
15. Both the counsels have referred pleadings and documents
placed on record who have also made their arguments in the
application for leave to defend as well as other application filed by the
defendants under Section 8 of the Arbitration and Conciliation Act,
1996 being I.A. No.21393/2012
16. After having examined the entire record, it appears that receipt
of the legal notice of the plaintiff dated 8th April, 2011 is not denied by
the defendants who failed to give any reply to the notice. The
defendants had not shown or placed on record the copies of the
sundry creditors. As per ledger of the plaintiff Company maintained
by the plaintiff Company, it would show that the defendants are in
arrears of Rs. 16,73,782/- for the financial year 2008-2009 and 2009-
2010. However, the ledger maintained by the plaintiff Company of the
defendants reflects that the defendants are still in arrears of Rs.
16,73,782/-. Copy of the ledger maintained by the plaintiff Company
duly certified by the Chartered Accountant and filed with the Income
Tax dept. has been annexed as Annexure P-X4.
17. It is an admitted case of the defendant No.1 that the defendant
No.1 had received the materials i.e. payers of Bill No.T-049 dated
22nd October, 2008, T-50 dated 23rd October, 2008, T-051 dated 24th
October, 2008. The defendants had purchased the materials who
himself is a trader. If the material of the above bills were found
defective having termite and was in a wet condition which could not
be stored by the defendants, the defendants could have returned the
material immediately and not have kept the same with them for 18
months.
18. It is impossible to believe the plea of the defendants
themselves as the defendants themselves have paid a part payment
of Rs.65,000/- on 17th January, 2009. Thereafter the defendants had
purchased another material vide the Bill No.T-77 dated 18th February,
2009 and T-78 of Rs.78,962/- and Rs.57,637/- respectively.
19. It has come on record that the quantity of the material against
the Bill Nos.T-49, T-50 and T-51 is about 4 trucks, approx. 34 tonnes,
and the defendants have to store the said material at a spacious
place, no such prudent person or business man shall keep the
material which is of termite and in wet condition in his store for about
18 months.
20. It appears that after receiving the notice dated 8th April, 2011,
and after filing the suit, the defendants had taken this false plea in the
grounds, which is an after-thought alleging that they had returned the
goods through Mr.G.S.Mishra to Mr.Birij, an employee of the plaintiff
Company on 2nd April, 2010 and 5th April, 2010 in relation to the debit
notes of Rs. 16,73,782/-, i.e. after expiry of 18 months. The said plea
and defence taken by the defendants are against the Sections 37, 41
and 42 of Sales of Goods Act. The plea of the defendants that the
material has been returned to the plaintiff at any point of time is
afterthought and the said plea cannot be accepted as per their own
conduct. Even the defendants have not replied to the legal notice
issued by the plaintiff Company.
21. The defendants had made the part payment of Rs.65,000/- on
17th January, 2009 in respect of the above first three bills. Since the
defendants have not made the balance payment and raised further
demand of material, therefore, the plaintiff Company had put the
condition to make the payment immediately of the materials which
reflects on the bills, but inspite of that the defendants failed to make
payment of the bills and had made payment after 28 days.
22. The plea taken by the defendants is apparently false. The
plaintiff Company has placed on record the copies of the Salary
Account of the year 2009-10 duly attested by the Chartered
Accountant which shows that Mr. Birij was no more in employment
with the plaintiff Company w.e.f. 1st August, 2009. The plaintiff
Company has filed the said return in the Income-Tax department.
The copy of the same has been annexed as Annexure P-X3.
23. It is argued on behalf of the plaintiff Company that no such
letter has ever been served upon the defendants himself or through
Mr.G.S.Misra at any point of time. The postal receipts and AD cards
have not been filed by the defendants. In case the goods were
defective, in normal case, the party has to approach to the seller and
make the complaint for very short time. But, in the present case there
was no evidence to show any protest made by the defendant No.1.
The story of returned goods is concocted one, otherwise immediately
on receipt of notice, the defendants would have given the reply to the
legal notice informing about it. They just kept mum and when the suit
was filed, the defendants started raising excuses of many kinds
which are on the face frivolous and without any logic. There is no
triable issue at all.
24. If the goods were defective, then it was the duty of the
defendants to return the said material immediately but the defendants
failed to do so which shows that the defence taken by the defendants
is an after-thought and moonshine which is raised not to make the
dues of the plaintiff in connivance with Mr. G.S.Misra who colluded
with the defendants and had filed a false affidavit knowing fully well
that the plea is false.
25. The defendants have also filed an application being I.A. No.
21393/2012 under Section 8 of the Arbitration and Conciliation Act,
1996 for referring the matter to the Arbitral Tribunal as per Rule 1 of
Clause XXX of the Constitution and Regulation of the Paper
Merchants Association (Regd), Delhi. In reply it was stated by the
plaintiff that the invoices/ bills have no arbitration clause. Further the
plaintiff Company no longer remained a member w.e.f. 11th May,
2011. The plaintiff Company has already resigned thus, the question
of attraction of clause does not arise. The application is not
maintainable. Counsel has argued that it is the admitted liabilities of
the defendants, even otherwise, thus in the absence of any disputes,
the matter is not required to refer for arbitration. After hearing, I am of
the considered view that once the Court has come to the conclusion
that it is the liabilities of the defendants and no such dispute exists
between the parties, the disputes alleged by the parties cannot be
referred merely by filing of application. From the entire gamut of the
matter, I am of the view that the principle amount is admitted due in
the year 2008, the same when not paid by the defendants, no ground
for leave to defend is sustained, the defence is wholly moonshine,
therefore the question of referring the matter to the Arbitral Tribunal
does not arise. The additional affidavit filed by the defendants is
without consequences.
26. Accordingly, the application filed by the defendants is
dismissed. Consequently, the suit of the plaintiff is decreed for a sum
of Rs. 16,73,782/- as principal amount. The plaintiff is entitled for
interest at the rate of 12% p.a. from the date of payment due till its
realization instead of interest claimed at the rate of 30% which is on
the face very high thus cannot be granted. The plaintiff is also entitled
for costs. Decree be drawn accordingly.
27. Both the applications filed by the defendants are therefore
dismissed. The application filed by the plaintiff under Section 340
Cr.P.C. has also become infructuous. The same is disposed of.
(MANMOHAN SINGH)
JUDGE
AUGUST 19, 2015
