Delhi High Court

M/S Sakata Inx(India) Ltd vs M/S Rexor India Limited & Ors on 4 November, 2015

$~7.
*    IN THE HIGH COURT OF DELHI AT NEW DELHI
+     CS(OS) 518/2012
      M/S SAKATA INX(INDIA) LTD                  ..... Plaintiff
                     Through: Mr. Arun Arora, Advocate with
                     Ms. Preeti, Advocate

                         versus

      M/S REXOR INDIA LIMITED & ORS                     ..... Defendants
                     Through: None
      CORAM:
      HON'BLE MS. JUSTICE HIMA KOHLI
                     ORDER

% 04.11.2015

1. The plaintiff has instituted the present suit under Order XXXVII

CPC against the defendants for recovery of a sum of Rs.2,31,45,314/-

alongwith the pendente lite and future interest.

2. Summons in the prescribed proforma were issued to the

defendants on 29.02.2012, returnable on 07.08.2012. The defendants

had entered appearance on 09.07.2012 and filed a memo of

appearance through counsel. Thereafter, the plaintiff had moved an

application for issuance of summons for judgment to the defendants on

which notice was issued on 21.05.2012 and the leave to defend

application was moved by the defendants (I.A. 14231/2012) within the

stipulated time. A reply in opposition to the said application was also

filed by the plaintiff, followed by a supplementary reply filed on

13.12.2014.

3. The records reveal that the defendants were represented

through counsel till 17.07.2014, but thereafter, their counsel had

stopped appearing. As a result, vide order dated 01.05.2015, the leave

to defend application filed by the defendants was dismissed for non-

prosecution and the case was adjourned to 27.08.2015. In all this

duration, no steps have been taken by the defendants to approach the

Court for setting aside the order dated 01.05.2015, nor has any

counsel appeared for the defendants today. The case was passed over

on the first call to await the defendants' presence but even on the

second call, none is present on their behalf.

4. Learned counsel for the plaintiff states that in the above facts and

circumstances, the plaintiff is entitled to a judgment in terms of Order

XXXVII Rule 3(6)(a) CPC.

5. The brief facts of the case as culled out from the plaint are that

the plaintiff, which is a company incorporated under the Companies Act

having its registered office at Rajasthan, is in the business of

manufacturing printing ink. When the defendants had approached the

plaintiff to place orders for supply of printing ink, the plaintiff had its

head office at Nehru Place, New Delhi. The orders for supply of ink

were placed by the defendants on the plaintiff at Delhi and the goods

were supplied from the plaintiff's Delhi office to the defendants at their

unit situated in Faridabad, Haryana. The terms of the invoice raised by

the plaintiff on the defendants for supplying the goods, stipulated that

the defendants were to make the payment within 90 days from the

date of supply of goods and in case of default, they were liable to pay

interest @24% per annum.

6. Counsel for the plaintiff states that on receiving orders from the

defendants, the plaintiff had supplied printing ink to them from time to

time, commencing from the year 2003 till the year 2009. It is stated

that an open and running account was maintained by the plaintiff in

respect of the goods supplied to the defendants, as would be reflected

from the extract of the ledger file, enclosed at Sr.No.4 of the list of

documents filed with the plaint.

7. It is submitted that as on 05.07.2009, the defendants were liable

to pay a sum of Rs.1,45,93,360/- to the plaintiff. At the end of the

financial year 2009, the plaintiff had written a letter dated 06.03.2009

to the defendants calling upon them to confirm that as per their

accounts, a sum of Rs.1,47,11,118/- was due and payable to the

plaintiff as on 28.02.2009. Learned counsel submits that the

defendants had duly executed a confirmation note and confirmed inter

alia that their books of account reflected an outstanding balance

amount of Rs.1,47,11,118/- payable to the plaintiff on 28.2.2009.

Thereafter, the plaintiff had kept on pursuing the defendants for release

of the payments and finally, in the month of December, 2009, they had

issued the following two cheques in favour of the plaintiff:-

 Sr.     Cheque       Date                Bank                  Amount
 No.       No.
  1.     705352    21.12.2009    State Bank of Patiala,   55,42,694/-
                                 Faridabad      (Main),
                                 Faridabad, Haryana.
  2.     705354    28.12.2009             -do-            55,09,796/-
                                         Total          1,09,52,490/-

8. The aforesaid cheques when presented by the plaintiff for

encashment to its banker, namely, Bank of Tokyo Mitsubishi UFJ Ltd.,

New Delhi, were dishonoured by the defendants' banker and the

plaintiff's bank had in turn issued a Cheque Return Advice dated

09.02.2010, stating inter alia that the said cheques were returned due

to "insufficient funds" in the account of the defendants.

9. Counsel for the plaintiff states that on receiving the information

with regard to the dishonour of the two cheques, the plaintiff had

served a legal notice dated 24.02.2010 on the defendants, duly

dispatched by registered post and UPC, calling upon them to make the

payment in respect of the two cheques but they had failed to give a

reply or take any remedial measures. Finally, the plaintiff was

constrained to lodge a complaint against the defendants under Section

138 of the Negotiable Instruments Act, which is stated to be pending

adjudication before the learned Judicial Magistrate, Faridabad, Haryana.

Subsequently, the plaintiff had instituted the present summary suit,

which is based on the acknowledgement of debit invoices raised by the

plaintiff and dishonour of cheques issued by the defendants in

discharge of their liability.

10. As noted above, the defendants had entered appearance in the

suit and filed a leave to defend application, which they failed to pursue

and finally, the same came to be dismissed for non-prosecution on

01.05.2015. Counsel for the plaintiff states that the defendants had

deliberately stopped appearing in the case after the plaintiff had filed a

supplementary reply to the leave to defend application and alongwith

the said reply, filed a copy of the letter dated 07.01.2013, issued by

M/s A.T. Enterprises, a courier agency who had denied the fact that it

had any business relationship with the defendants and refuted their

claim that it had allegedly couriered any article to the plaintiff. He

states that the defendants had contested the claim of the plaintiff and

enclosed debit notes to the tune of Rs.1,54,52,957/- with the leave to

defend application alongwith proof of service through courier (Annexure

A-1) and had asserted that the said debits notes had been dispatched

through the captioned courier agency, which were in fact never

dispatched. When confronted with the contents of the letter dated

07.01.2013 issued by the courier agency stating inter alia that they had

no business relationship with the defendants and somebody had

misused the proof of delivery formats of the agency, the defendants

and their counsel had abruptly stopped appearing in the case and

elected to stay away.

11. Counsel for the plaintiff goes on to state that this is not the only

suit that has been filed against the defendants who are regular

defaulters. He submits that apart from the plaintiff herein, an entity

named M/s Coim India Pvt. Ltd. had also filed a summary suit against

the defendants in this Court, registered as CS(OS) 287/2011, which

was decreed in their favour for a sum of Rs.72,14,950/- alongwith

pendente lite and future interest @8% per annum. A copy of the order

dated 30.1.2014 passed in the captioned suit is handed over by learned

counsel for the plaintiff and taken on record. He adds that in the

complaint case filed by the plaintiff against the defendant under Section

138 of the Negotiable Instruments Act, Shri M.C. Somani, Managing

Director of the defendants had stopped appearing before the Judicial

Magistrate, Faridabad who had declared him as a absconder vide order

dated 31.05.2014. He thus states that the defendants have made every

effort under the sun to stall the suit proceedings and thereby delay

making the payment which the plaintiff is lawfully entitled to receive.

12. This Court has perused the plaint and the documents filed

therewith. The document reflecting the balance confirmation by the

defendants reveals that they have unambiguously confirmed that a sum

of Rs.1,47,11,118/- was payable to the plaintiff as on 28.02.2009.

Further, in acknowledgement of their debts, the defendants had issued

two cheques totalling to a sum of Rs.1,09,52,490/- in favour of the

plaintiff, which when presented, were dishonoured for insufficient

funds.

13. It has to be held that the suit filed by the plaintiff under Order 37

CPC has been instituted not only on the basis of the defendant's written

confirmation of amounts due and payable to the plaintiff, which would

constitute a "written contract" under Order XXXVII Rule 1 CPC, but also

on the basis of the Negotiable Instrument Act. In the case of Daya

Chand Uttam Prakash Jain and Anr. Vs. Santosh Devi Sharma reported

as 67 (1997) DLT 13 where the maintainability of a suit on the basis

of an acknowledgment was being examined, on a conspectus of the

case law on the subject, the Single Judge of this Court had held that a

suit under Order XXXVII CPC can be filed on the basis of an

acknowledgement and had observed as below:

"Para : 14 .......It appears to me that suit on the basis of written acknowledgment of a pre-existing debt being a written contract could form a basis for recovery of an existing debt based on the said written contract in the shape

of written acknowledgment. In view of the observations in Food Corporation of India v. Bal Kishan Garg, reported as (1982) 21 DLT 167, the amount of the debt had been ascertained between the parties and the interest is also readily calculable amount in view of the past conduct of the parties. The acknowledgement was of a pre-existing debt. The purpose of giving this written acknowledgment implies in it an absolute unqualified present liability with an obligation to repay it in future on the understanding that the creditor need not file a suit immediately. Consequently, the written acknowledgment surely falls under the term "written contract" and the parties had consensus of mind when this written acknowledgement was signed by one of the partners of the petitioner firm. There was a promise. There was consideration. There was acceptance. All the elements essential for the formation of written contract were present. Nothing more is required in this acknowledgement to make it a written contract. Accordingly, I am of the definite opinion that the present suit has been filed on the basis of a "written contract" for the recovery of the existing debt on the basis of this "account stated" and the case on the basis written contract in the shape of written acknowledgment, is certainly maintainable under Order 37, CPC." (emphasis added)

14. The pleas taken by the plaintiff in the present suit have gone

unrebutted. The leave to defend application filed by the defendant was

dismissed for non-prosecution on 01.5.2015 and thereafter, they have

not taken any steps to set aside the said order. As a result, the

unrebutted averments made in the plaint have to be accepted as

correct. In view of the fact that the defendants have acknowledged

having received the goods from the plaintiff and confirmed in writing

that they owed a sum of Rs.1,47,11,118/- to the plaintiff as on

28.02.2009 and further, having regard to the fact that the defendants

had issued two cheques in favour of the plaintiff for the goods supplied

which were dishonoured on presentation, there is no impediment in

passing a judgment in favour of the plaintiff.