Delhi High Court
Oakridge Energy Private Limited vs Amplus Power Solutions Private ... on 16 August, 2018
$~OS-5
* IN THE HIGH COURT OF DELHI AT NEW DELHI
% Date of decision 16.08.2018
+ CS(COMM) 869/2017
OAKRIDGE ENERGY PRIVATE LIMITED ..... Plaintiff
Through Mr.Vikas Mehta, Mr.Pallav and
Mr.Apoorv, Advs.
versus
AMPLUS POWER SOLUTIONS PRIVATE LIMITED & ORS
..... Defendant
Through Mr.Rajdee Choudhary and
Mr.Aayush Chandra, Advs. for D-1 and D-2
CORAM:
HON'BLE MR. JUSTICE JAYANT NATH
JAYANT NATH, J. (ORAL)
IA No.4193/2018
1. This application is filed under Order 7 Rule 11(a) CPC, 1908 seeking
rejection of the plaint. It has been pleaded that a perusal of the plaint would
reveal that it is based on an incorrect and opportunistic reading of the Letter
of Intent dated 9.1.2017. It is pleaded that under Clause 14 of the LOI the
purpose of the said LOI was to facilitate further discussion to achieve
execution of definitive documents, on the terms substantially reflecting the
terms contained in the LOI. It is stated that LOI was not binding on the
parties. It is further stated that LOI did not exhaustively set out the
contractual understanding and/or terms and conditions governing the
services to be provided by the plaintiff and the obligations of the defendant
No.1 with respect to acquisition of land.
2. The suit has been filed by the plaintiff seeking recovery of
Rs.2,05,00,000/- from the defendant. It has been pleaded in the suit that a
Letter of Intent dated 9.1.2017 was issued by the defendant to the plaintiff to
engage the plaintiff's consultancy services for acquisition of suitable lands
and electricity transmission line connectivity with relation to a 20MW solar
photovoltaic power project proposed to be set up in Andhra Pradesh. It is
pleaded that the plaintiff conducted detailed land surveys, joint site visits
etc. to identify suitable land parcels for acquisition in the identified districts
and kept sharing details and information regarding the land parcels with the
defendants. Suitable land parcels were proposed to the defendant for
approval. Various communications were exchanged between the parties and
invoices were raised on 31.3.2017 for Rs.2,30,000/-. On 11.4.2017 the
plaintiff received remittance of the said invoice dated 31.3.2017. Further
work has been undertaken thereafter. Plaintiff is said to have sent a final due
diligence report. On 22.9.2017 defendants are said to have issued an email to
the plaintiffs stating that they are terminating the agreement between the
parties. Plaintiff claims that this is in breach and violation of the terms of the
LOI.
3. Hence, the present suit claiming damages.
4. I have heard learned counsel for the applicant/defendant. He has
vehemently argued that the claim that has been urged by the plaintiff does
not arise from the LOI dated 9.1.2017 as all obligations of the defendant
came to an end on payment of the invoice raised by the plaintiff dated
31.3.2017. He states that the plaint fails to spell out a cause of action.
5. After some arguments, it was put to learned counsel for the defendant
that the contention of the defendant that no amount is due on a reading of the
LOI can be dealt with at the time of framing the issues. However, he was
emphatic that no cause of action arises from a perusal of the plaint and
hence same should be rejected under Order 7 Rule 11 CPC.
6. Order 7 Rule 11 CPC reads as follows:-
The plaint shall be rejected in the following cases:-
(a) where it does not disclose a cause of action;
(b) where the relief claimed is undervalued, and the plaintiff, on
being required by the Court to correct the valuation within a time to
be fixed by the Court, fails to do so;
(c) where the relief claimed is properly valued but the plaint is
written upon paper insufficiently stamped, and the plaintiff, on being
required by the Court to supply the requisite stamp-paper within a
time to be fixed by the Court, fails to do so;
(d) where the suit appears from the statement in the plaint to be
barred by any law;
(e) where it is not filed in duplicate;]
(f) where the plaintiff fails to comply with the provisions of rule 9:
..................."
7. While considering an application under Order 7 Rule 11 CPC, the
court can only look at the averments in the plaint and the accompanying
documents. In Tilak Raj Bhagat vs. Ranjit Kaur, 2012 VAD (Delhi) 186
this court held as follows:-
"5. It may be worthwhile to mention here that while
considering an application under Order 7 Rule 11 CPC, the
Court has to look at the averments made in the plaint by taking
the same as correct on its face value as also the documents filed
in support thereof. Neither defence of the defendant nor
averments made in the application have to be given any
weightage. Plaint has to be read as a whole together with the
documents filed by the plaintiff."
8. To the same effect are the judgments of the Division Bench of this
Court in the case of Indian City Properties Ltd. Vs. Vimla Singh & Ors.
198(2013) DLT 432 and in the case of Inspiration Clothes & U vs. Collby
International Ltd., 88(2000) DLT 769.
9. Reference may also be had to a judgment of the Supreme Court in the
case of Hardesh Ores Pvt. Ltd v. M/s Hede and Company 2007 (7) SCALE
348, noted as follows:
"21. The language of Order VII Rule 11 CPC is quite clear and
unambiguous. The plaint can be rejected on the ground of
limitation only where the suit appears from the statement in the
plaint to be barred by any law. Mr. Nariman did not dispute that
"law within the meaning of clause (d) of Order VII Rule 11
must include the law of limitation as well. It is well settled that
whether a plaint discloses a cause of action is essentially a
question of fact, but whether it does or does not must be found
out from reading the plaint itself. For the said purpose the
averments made in the plaint, in their entirety must be held to
be correct."
10. Averments in the plaint are to be accepted as correct for the purpose
of adjudication of an application under Order 7 Rule 11 CPC. Mere reading
of the plaint here shows that averments have been made regarding unpaid
dues arising from a contract between the parties. The LOI is claimed to the
Contract. The defendant has based on this document made payments to the
plaintiff. It cannot be said that the plaint fails to disclose a cause of action.
11. There is no merit in the present application. Same is dismissed.
Needless to add the issues which are pleaded by the defendant can be
adjudicated upon at a subsequent stage, as per law.
IA No.4121/2018
List on 17.8.2018 before Joint Registrar.
JAYANT NATH, J
AUGUST 16, 2018
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